Friday, August 04, 2006

July Employment Report

by Bill McBride on 8/04/2006 10:02:00 AM

MarketWatch reports: U.S. nonfarm payrolls rise 113,000 in July

The U.S. economy added fewer-than-expected nonfarm jobs in July and the unemployment rate rose to its highest level since February, the Labor Department said on Friday ...

U.S. nonfarm payrolls climbed by 113,000 in July after a revised 124,000 gain in June and the unemployment rate rose to 4.8% in July from June's 4.6%.
Click on graph for larger image.

Here is the cumulative nonfarm job growth for Bush's 2nd term. The gray area represents the expected job growth (from 6 million to 10 million jobs over the four year term). Job growth is about in the middle of the expected range.

The following two graphs are the areas I've been watching closely: residential construction and retail employment.


Residential construction employment decreased by 9,000 jobs in July and is now down about 1% from the peak in February.

Note the scale doesn't start from zero: this is to better show the change in employment.


Retail employment was flat in July after 3 months of slight declines. The YoY change in retail employment is now -0.5%. As Jan Hatzius noted:
"Year-on-year declines in retail employment are unprecedented outside of recessions."