Total employment in the U.S. grew by 163,000 positions in July as the unemployment rate grew from 8.2 to 8.3 percent, according to the Labor Department. Forecasts by economists estimated only 100,000 jobs would be added during the month. Job growth was at its highest level in five months, and if trends hold, could signal the beginning of a more robust period of job growth going into the end of the year.
Of the four categories of unemployment--job losers, job leavers, new entrants and reentrants--only one, reentrants grew during the month. While it statistically means a rise in the unemployment rate, it most commonly is looked on as a positive that once discouraged or disfranchised workers are returning to the job market. Year-over-year, the number of workers marginally attached to the labor force--meaning they have looked for a job in the last 12 months, but not in the last four weeks--has fallen from 2.8 million to 2.5 million.
The professional and managerial unemployment rate fell from 5 to 4.8 percent year-over-year, while the unemployment rate for those with bachelor's degree or higher remained flat at 4.1 percent. Over the last year, the unemployment rate has fallen for almost every industry, except for mining and oil and gas extraction, up from 6 to 7.6 percent, and education and health services, up from 5.9 to 6.5 percent. The mean length of unemployment fell substantially in July to 38.8 weeks from 39.9 weeks while the median duration fell from 19.8 weeks to 16.7 weeks.
Temporary employment grew by 14,100 positions in the month, while food services and drinking places added 29,400 positions. Healthcare employment grew by 12,000 positions and educational services grew by 19,100. Computer systems design and related consulting added 7,000 jobs. The only two sectors to see meaningful declines included non-residential specialty trade contractors (9,500) and utilities (8,000).
July's numbers were the first positive indication out of the Labor Department's monthly report since February, with job growth again outpacing general population growth. Shortly after the numbers were released, U.S. equities markets responded positively as traders hoped for an early sign of a new period of more substantial job growth in the coming months. It will be one or two months before we can see if this is a trend or a blip, but indications from the past several years give us reason to expect increasingly strong job growth for the balance of the year.