Payroll Employment Rises by 187,000 in July; Unemployment Rate Changed Little at 3.5 Percent

Both the unemployment rate, at 3.5 percent, and the number of unemployed persons, at 5.8 million, changed little in July. The unemployment rate has ranged from 3.4 percent to 3.7 percent since March 2022.

The number of persons employed part time for economic reasons, at 4.0 million, changed little in July. 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.

The number of persons not in the labor force who currently want a job was 5.2 million in July, little changed from the prior month. 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 was essentially unchanged at 1.4 million in July. 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. The number of discouraged workers, a subset of the marginally attached who believed that no jobs were available for them, changed little at 335,000 in July.

INDUSTRY FOCUS

• Total nonfarm payroll employment rose by 187,000 in July, less than the average monthly gain of 312,000 over the prior 12 months. In July, job gains occurred in health care, social assistance, financial activities, and wholesale trade.
• In July, health care added 63,000 jobs, compared with the average monthly gain of 51,000 in the prior 12 months. Over the month, job growth occurred in ambulatory health care services (+35,000), hospitals (+16,000), and nursing and residential care facilities (+12,000).
• Social assistance added 24,000 jobs in July, in line with the average monthly gain of 23,000 in the prior 12 months. Individual and family services added 19,000 jobs over the month.
• Employment in financial activities increased by 19,000 in July. The industry had added an average of 16,000 jobs per month in the second quarter of the year, after employment was essentially flat in the first quarter. Over the month, a job gain in real estate and rental and leasing (+12,000) was partially offset by a loss in commercial banking (-3,000).
• In July, employment in wholesale trade increased by 18,000, after showing little net change in recent months.
• Employment in the other services industry continued to trend up in July (+20,000), compared with the average monthly gain of 15,000 over the prior 12 months. Employment in personal and laundry services continued to trend up over the month (+11,000). Employment in other services remains below its prepandemic February 2020 level by 53,000, or 0.9 percent.
• Construction employment continued to trend up in July (+19,000), in line with the average monthly gain of 17,000 in the prior 12 months. Over the month, job growth occurred in residential specialty trade contractors (+13,000) and in nonresidential building construction (+11,000).
• In July, employment in leisure and hospitality was little changed (+17,000). The industry has shown little employment change in recent months, following average monthly gains of 67,000 in the first quarter of the year. Employment in leisure and hospitality remains below its February 2020 level by 352,000, or 2.1 percent.
• Employment in professional and business services changed little in July (-8,000). Monthly job growth in the industry had averaged 38,000 in the prior 12 months. Employment in temporary help services continued to trend down over the month (-22,000) and is down by 205,000 since its peak in March 2022. Employment in professional, scientific, and technical services continued to trend up in July (+24,000).
• Employment showed little change over the month in other major industries, including mining, quarrying, and oil and gas extraction; manufacturing; retail trade; transportation and warehousing; information; and government.

Source: Bureau of Labor and Statistics, THE EMPLOYMENT SITUATION — July 2023