Investing News

Employment Up by 315,000 in August 2022

The U.S. economy added 315,000 nonfarm payroll jobs in August 2022, but the unemployment rate rose to 3.7% from 3.5% in July. Notable job gains were observed in professional and business services, healthcare, and retail trade.

Economists surveyed by Bloomberg had forecast job growth of 300,000 in August, with the unemployment rate remaining at 3.5%. They also expected a solid gain in average hourly earnings. Those surveyed by Dow Jones expected the new jobs figure to be 318,000.

Key Takeaways

  • The U.S. economy added 315,000 new jobs in August 2022.
  • Economists had expected gains in the range of 300,000 to 318,000 new jobs.
  • The unemployment rate rose to 3.7% from 3.5% in July.
  • Average hourly wages rose by 0.3% in the month of August and by 5.2% year over year.

Unemployment Rate Rises Slightly

The unemployment rate in August 2022 rose to 3.7% from 3.5% in July. The number of unemployed persons increased by 344,000 to 6.0 million. In July, these figures had returned to their levels in February 2020, prior to the outbreak of the COVID-19 pandemic.

Temporary Layoffs Stable, Permanent Job Losses Up

Among the unemployed, the number of those on temporary layoff was virtually unchanged, at 782,000. Permanent job losers numbered 1.4 million in August 2022, up by 188,000. The pre-pandemic figures in February 2020 were 780,000 and 1.3 million, respectively.

Long-Term Unemployment Unchanged

The number of long-term unemployed (people who have been jobless for 27 weeks or more) was 1.1 million in August, little changed from July. The long-term unemployed represented 18.8% of the total number of unemployed in August 2022.

Labor Force Participation Up Slightly

The labor force participation rate in August was 62.4%, up from 62.1% in July. The employment-to-population ratio remained at 60.1%. The pre-pandemic figures in February 2020 were 63.4% and 61.2%, respectively.

Number of Potential Job Seekers Down

The number of persons who were not in the labor force but who would like to take a job fell by 361,000 to 5.5 million in August. This figure was 5.0 million in February 2020. These people were not classified as unemployed since they either were not actively looking for work during the four weeks preceding the survey or were unavailable to take a job. The number of discouraged workers, those who believed that no jobs were available for them, remained stable from July to August, at 366,000.

Earnings Up, Working Hours Down

In August 2022, the average hourly earnings for all employees on private nonfarm payrolls rose by 10 cents (0.3%) to $32.36. Over the past 12 months, average hourly earnings have increased by 5.2%.

Meanwhile, the average workweek for all employees on private nonfarm payrolls fell by 0.1 hour to 34.5 hours in August. In manufacturing, the average workweek was stable 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.

Biggest Job Gains by Industry

The biggest job gains for August 2022 were concentrated in these industries: professional and business services (+68,000), healthcare (+48,000), retail trade (+44,000), leisure and hospitality (+31,000), manufacturing (+22,000), financial activities (+17,000), wholesale trade (+15,000), and mining (+6,000).

The industries listed above combined to add 251,000 jobs, or 79.7% of the August total of 315,000. Employment showed little change over the month in other major industries, including construction, transportation and warehousing, information, other services, and government.

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