The unemployment rate for July is 3.5%, adding 528,000 jobs in the month, according to the U.S. Labor Department.
This is tremendously positive jobs data puts unemployment at 50-year lows, yet markets are down and talks of a recession remain widespread as inflation remains at 40-year highs.
Economists surveyed by Bloomberg had projected an increase of only 250,000 jobs to be added which was clearly blown out of the water.
Wage growth came in more than expected, reversing the month over month declines.
Further, the revisions to the May and June unemployment data indicate there were 28,000 more jobs added in that time than previously reported.
Meanwhile, the job participation rate fell to 62.7% from 62.2% indicating that there are fewer people actually in the workforce.
Unemployment data doesn’t offer actual reasons for any of the data, but one could look at one highly unknown factor: Long COVID. the long COVID data which estimates 4 million Americans are out of work because of long-term effects of the virus.
Federal Reserve chairman Jerome Powell is expected to continue hiking interest rates regardless of today’s job numbers, but today’s numbers will likely add even more pressure on their strategy of multiple increases for the remainder of the year.
The increases were not equal across all sectors and all demographics. Construction, retail, and transportation all added numerous jobs, yet black Americans experienced the least advantage, according to the data.
For example, 5.6% of Black women are unemployed, an improvement from the previous month, but nearly double the rate of white women. At the same time, the participation rate of Black men fell from 68.9% to 68.1%.
This data also doesn’t include companies with fewer than 50 employees which some analysts believe is where an unequal amount of suffereing remains.
The overall data is positive, but if an improvement is not being experienced across all types of people, the resilience of our labor market is in question.