August’s jobs report was another sign that the US job market is cooling, though some sectors that fueled the post-pandemic recovery still remain strong.
The U.S. Department of Labor said on Friday that the economy added 187,000 jobs in August, while the unemployment rate rose to 3.8%. Wage growth was driven by health care and social security, creating more than 97,000 jobs. This category would have grown by over 100,000 if private education was included, as some economists do.
Leisure and hospitality also provided another 40,000 jobs.
“Leisure and hospitality are still well below pre-pandemic employment levels, and well below pre-pandemic employment trends. So we’re not that surprised by the continued growth there. In healthcare, you are returning to pre-pandemic levels. pandemic trends in employment, due in part to increased demand,” said Andrew Patterson, senior global economist at Vanguard.
On the other side of the report, some of the categories with the largest job losses came with important caveats.
For example, more than 34,000 jobs have been lost in the transport and storage sector. That was caused by a drop of nearly 37,000 jobs in the trucking industry, which the Labor Department attributed to a plant shutdown. This is likely a reference to Yellow’s filing for bankruptcy protection in August.
Similarly, the loss of 15,000 jobs in the information sector appears to have been largely driven by writers’ and actors’ strikes in Hollywood, which have largely halted production in the US. The film and sound recording subcategory fell by nearly 17,000 jobs, according to the Department of Labor. said.
“I would say these are probably one-off incidents. … We do not expect this to continue in the future. But even if you add that back in, you’re still at the low 200,000 jobs, which is a decline from the middle of the last century. 200,000, which we saw for much of the year, and even higher than earlier this year,” Patterson said.
“That said, even with these ‘weaker reports’ you are still talking about adding 180,000 jobs per month, which is well above the figure needed to account for new entrants into the job market,” the economist added please.
The report also notes that temporary emergency services jobs have declined by about 19,000 and are now down by 242,000 since March 2022.
— CNBC’s Gabriel Cortes contributed to the reporting.