US Nonfarm Payrolls in August rose 315,000 (consensus 300,000) after the prior revised increase of 526,000 (from 528,000). Nonfarm Private Payrolls rose by 308,000 (consensus 280,000) after a revised 477,000 increase in July (from 471,000). August ADP Employment Change Report showed an estimated 132,000 employees were added to private sector payrolls versus 270,000 in July based on ADP’s revised methodology.
The Unemployment Rate was 3.7% (consensus 3.5%) versus the prior 3.5% reading as the labor force participation rate jumped to 62.4% from 62.1%. Average Hourly Earnings rose 0.3% (consensus 0.4%) after July’s 0.5% increase. The Average Workweek was 34.5 (consensus 34.6) after the prior 34.6.
August 2022 US Employment Report
The jobless rate rose to at 3.7% the Labor Department reported Friday. The unemployment rate fell this month after last month reaching the February 2020 pre-pandemic rate of 3.5%, which was a 50-year low.
The market had expected the July report released Friday to show nonfarm payrolls rise 300k new jobs which it beat with 315k new jobs. Employers added an average 378,000 jobs in the past three months, well above the prepandemic trend but a slowdown from last year. In August, job gains were strong in professional and business services, healthcare, and retail. On Wednesday August ADP Employment Change Report showed an estimated 132,000 employees were added to private sector payrolls versus 270,000 in July based on ADP’s revised methodology
Employers hired across industries. Companies in certain industries that are vulnerable to interest-rate increases, such as technology and real estate, have announced layoffs. Some firms have implemented hiring freezes.
The labor force participation rate, which measures the share of the population working or looking for work rose to 62.4% in August from 62.1% in July. More workers joining the labor force could help sustain job growth in the coming months. Participation was still down from 63.4% in February 2020.
A severe labor shortage has driven up annual wage increases above 5% every month of this year. By contrast, wage gains averaged 3.2% in the 12 months to February 2020. Wage growth eased last month. Average hourly earnings rose by 0.3% in August from a month earlier. They were up 5.2% from a year earlier, nearly the same as in July.
Total nonfarm employment has increased by 22.0 million since hitting a trough in April 2020 and has returned to the pre-pandemic level. Private-sector employment is 629K higher than in February 2020, although several sectors have yet to recover. On the other hand, government employment is still 597K lower than its pre-pandemic level.
August 2022 US Employment Report and Expectations
- US Nonfarm Payrolls Aug: 315K (est 298K; prev 528K)
- US Unemployment Rate (M/M) Aug: 3.7% (est 3.5%; prev 3.5%)
- US Labour Force Participation Rate Aug: 62.4% (est 62.2%; prev 62.1%)
- Two-month net revision -107K, June was revised down by 105,000, from +398,000 to +293,000, and the change for July was revised down by 2,000, from +528,000 to +526,000. With these revisions, employment in June and July combined is 107,000 lower than previously reported.
- US Private Payrolls Aug: 308K (est 300K; prev 471K)
- US Manufacturing Payrolls Aug: 22K (est 15K; prev 30K)
- US Change in Government Payrolls Aug +7K (prev +49K)
- U6 underemployment rate 6.7% vs 6.7% prior
- Long-term unemployed at 1.1m vs (prev 1.4m, 1.2m pre-pandemic)
- The employment-population ratio 60.1% vs (prev 62.1%, 61.2% before pandemic)
- US Average Hourly Earnings (M/M) Aug: 0.3% (est 0.4%; prev 0.5%)
- US Average Hourly Earnings (Y/Y) Aug: 5.2% (est 5.3%; prev 5.2%)
The unemployment rate and number of unemployed persons prior to the coronavirus (COVID-19) pandemic was 3.5 percent and 5.7 million, respectively, in February 2020)
Where the Jobs Were:
Job gains were widespread. In June, 7.1 percent of employed persons teleworked because of the coronavirus pandemic, down from 7.4 percent in the prior month. These data refer to employed persons who teleworked or worked at home for pay at some point in the 4 weeks preceding the survey specifically because of the pandemic.
Largest gains occurring in:
- Business services +68k (+84k)
- Education/health +68k (+118k)
- Retail trade +44k (+29k)
- Leisure/hospitality +31k (+95k)
- Manufacturing +22k (+36k)
- Financial +17k (+13k)
- Construction +16k (+24k)
- Temporary help +12k (+9k)
- Information +7k (+16k)
That leaves the economy down by 1.2 million jobs, or 0.8 percent, from its pre-pandemic level in February 2020.
Employment in manufacturing increased by 22 thousand in August of 2022, slightly above forecasts of a 20 thousand increase but easing from the upwardly revised 36 thousand jump in the prior month. Employment in durable goods industries rose by 19 thousand workers, while those in non-durable goods industries increased by a softer 3 thousand workers.
May Employment Reports
- ADP Reports US Added Just 128K Jobs in May at Slowest Pace Since Covid Lockdowns
- US Job Openings for April 11.400M Down From 11.855M in March
Household Survey Data
In August, the unemployment rate rose by 0.2 percentage point to 3.7 percent, and the number of
unemployed persons increased by 344,000 to 6.0 million. In July, these measures had returned to their
levels in February 2020, prior to the coronavirus (COVID-19) pandemic.
Among the major worker groups, the unemployment rates for adult men (3.5 percent) and Hispanics
(4.5 percent) rose in August. The jobless rates for adult women (3.3 percent), teenagers (10.4 percent), Whites (3.2 percent), Blacks (6.4 percent), and Asians (2.8 percent) showed little change over the
Among the unemployed, the number of permanent job losers increased by 188,000 to 1.4 million in
August. The number of persons on temporary layoff was virtually unchanged at 782,000. (See table A11.)
The number of long-term unemployed (those jobless for 27 weeks or more) was little changed at 1.1
million in August. The long-term unemployed accounted for 18.8 percent of all unemployed persons.
The labor force participation rate increased by 0.3 percentage point over the month to 62.4 percent but
is 1.0 percentage point below its February 2020 level. The employment-population ratio was little
changed at 60.1 percent in August and remains 1.1 percentage points below its February 2020 value.
The number of persons employed part time for economic reasons was little changed at 4.1 million in
August. These individuals, who would have preferred full-time employment, were working part time
because their hours had been reduced or they were unable to find full-time jobs. (See table A-8.)
The number of persons not in the labor force who currently want a job declined by 361,000 to 5.5
million in August. This measure remains above its February 2020 level of 5.0 million. These individuals
were not counted as unemployed because they were not actively looking for work during the 4 weeks
preceding the survey or were unavailable to take a job.
Among those not in the labor force who wanted a job, the number of persons marginally attached to
the labor force, at 1.4 million, was little changed in August. These individuals wanted and were
available for work and had looked for a job sometime in the prior 12 months but had not looked for
work in the 4 weeks preceding the survey. Discouraged workers, a subset of the marginally attached
who believed that no jobs were available for them, numbered 366,000 in August, little changed from the
Household Survey Supplemental Data
In August, 6.5 percent of employed persons teleworked because of the coronavirus pandemic, down
from 7.1 percent in the prior month. These data refer to employed persons who teleworked or worked at
home for pay at some point in the 4 weeks preceding the survey specifically because of the pandemic.
In August, 1.9 million persons reported that they had been unable to work because their employer
closed or lost business due to the pandemic—that is, they did not work at all or worked fewer hours at
some point in the 4 weeks preceding the survey due to the pandemic. This measure is down from 2.2
million in the previous month. Among those who reported in August that they were unable to work
because of pandemic-related closures or lost business, 21.5 percent received at least some pay from
their employer for the hours not worked, little different from the previous month.
Among those not in the labor force in August, 523,000 persons were prevented from looking for work
due to the pandemic, little changed from the prior month. (To be counted as unemployed, by definition,
individuals must be either actively looking for work or on temporary layoff.)
These supplemental data come from questions added to the household survey in May 2020 to help gauge the effects of the pandemic on the labor market. The data are not seasonally adjusted.
Establishment Survey Data
Total nonfarm payroll employment increased by 315,000 in August. Nonfarm employment has risen
by 5.8 million over the past 12 months, as the labor market continued to recover from the job losses of
the pandemic-induced recession. This growth brings total nonfarm employment 240,000 higher than its
pre-pandemic level in February 2020. In August, notable job gains occurred in professional and business
services, health care, and retail trade.
Professional and business services added 68,000 jobs in August. Within the industry, employment
gains occurred in computer systems design and related services (+14,000), management and technical
consulting services (+13,000), architectural and engineering services (+10,000), and scientific research
and development services (+6,000), while legal services lost jobs (-9,000). Over the past 12 months,
professional and business services has added 1.1 million jobs.
In August, health care employment rose by 48,000, with job gains in offices of physicians (+15,000),
hospitals (+15,000), and nursing and residential care facilities (+12,000). Health care has added 412,000
jobs over the year. Despite this growth, employment in health care is below its February 2020 level by
37,000, or 0.2 percent.
Retail trade added 44,000 jobs in August and 422,000 jobs over the past 12 months. In August,
employment increased in general merchandise stores (+15,000), food and beverage stores (+15,000),
health and personal care stores (+10,000), and building material and garden supply stores (+7,000).
Employment in furniture and home furnishings stores continued to trend down (-3,000).
Manufacturing employment continued to trend up in August (+22,000), with gains concentrated in
durable goods industries (+19,000). Manufacturing has added 461,000 jobs over the year.
Employment in financial activities rose by 17,000 in August and by 200,000 over the year.
Employment in wholesale trade increased by 15,000 in August, returning to its February 2020 level.
This industry has added 197,000 jobs over the year.
Mining employment rose by 6,000 in August, reflecting a gain in support activities for mining (+7,000).
Over the year, mining has added 68,000 jobs.
Employment in leisure and hospitality changed little in August (+31,000), following average monthly
gains of 90,000 in the first 7 months of the year. Employment in leisure and hospitality is below its
February 2020 level by 1.2 million, or 7.2 percent.
In August, employment showed little change in other major industries, including construction,
transportation and warehousing, information, other services, and government.
In August, average hourly earnings for all employees on private nonfarm payrolls rose by 10 cents, or
0.3 percent, to $32.36. Over the past 12 months, average hourly earnings have increased by 5.2 percent.
In August, average hourly earnings of private-sector production and nonsupervisory employees rose
by 10 cents, or 0.4 percent, to $27.68.
The average workweek for all employees on private nonfarm payrolls decreased by 0.1 hour to 34.5
hours in August. In manufacturing, the average workweek for all employees was little changed at 40.3
hours, and overtime held at 3.3 hours. The average workweek for production and nonsupervisory
employees on private nonfarm payrolls declined by 0.1 hour to 33.9 hours.
The change in total nonfarm payroll employment for June was revised down by 105,000, from +398,000
to +293,000, and the change for July was revised down by 2,000, from +528,000 to +526,000. With
these revisions, employment in June and July combined is 107,000 lower than previously reported.
(Monthly revisions result from additional reports received from businesses and government agencies
since the last published estimates and from the recalculation of seasonal factors.
The Employment Situation for September is scheduled to be released on Friday, October 7, 2022,
at 8:30 a.m. (ET)
August ADP Employment Change Report showed an estimated 132,000 employees were added to private sector payrolls versus 270,000 in July based on ADP’s revised methodology
From The TradersCommunity News Desk