Sunday, August 3, 2014

July jobs- keeps on keeping on.

Friday featured another US jobs report for July. And it showed that things are still going well when it comes to employment growth in 2014. 209,000 added on a seasonally-adjusted basis, 198,000 in the private sector, and May and June revised up (by 5,000 in May and 10,000 in June), so we ended up 224,000 total jobs ahead of where we thought we were. That now brings job growth to over 1.6 million since the start of the year, and 2.57 million in the last 12 months- the best 12-month growth since the housing bubble was still around in April 2006. As mentioned in the GDP piece I wrote earlier this weekend, the better savings rate in 2014 makes this expansion seem a bit more healthy and longer-lasting than what we had in the “spend it all” 2000s, and the recent economic data seems to back this up.

Even the tick up in unemployment from 6.1% to 6.2% wasn’t all that bad, as it was a reflection of 329,000 people getting back into the work force, and a decent amount of them ended up being employed. Obviously, being over 6% is still below full employment, which means there is plenty more work to do in order to dig out of the mess of the Great Recession. But the trend is still in the right direction, as it’s gone down 1.1% in the last 12 months, and 2.0% lower than it was 2 years ago.

Notably, growth has been pretty broad-based in the last couple of months. Construction was up 22,000 in the last month an 32,000 since May- seasonally-adjusted gains that go beyond the typical Summertime hiring in that field. Manufacturing grew by 28,000 jobs in July, is up 66,000 jobs in the last 3 months, and 178,000 in the last year. Certainly there needs to be a lot more done to come close to alleviating the damage done to employment in that field over the last 30 years, but it’s at least a long-lasting recovery in that sector (with year-over-year gains for each month for nearly the last 4 years).

These numbers also make it even more remarkable that Wisconsin continues to lag so badly in job growth. Remember, Wisconsin has the second-highest ratio in the country when it comes to jobs in manufacturing, so if employment in those fields are taking off, we should be doing pretty well. But we’re not, as Wisconsin lost private sector jobs in May and June, and the Walker jobs gap grew even further with the May and June revisions, now reaching 66,000.

Now we need to add another 4,300 jobs in July just to keep up with the strong pace in the rest of the nation, and 17,000 in order to make up for the ground we lost in May and June, a tall order that I'd call that "highly unlikely." And that doesn’t even count the 600 people at Cargill’s Milwaukee slaughterhouse that lost their jobs on Friday. While the rest of the nation keeps in its steady growth rate (a rate that's been picking up in the last few months), Wisconsin keeps on lagging.

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