US adds 255,000 jobs in July: 'Everything you could have asked for'?
The labor market looks strong, the Labor Department said Friday, announcing that employers added 255,000 jobs in July while unemployment remained at 4.9 percent.
The news far outstripped economists' predictions of 179,000 job gains. July's job increases came after employers added 292,000 jobs in June, a signal that the economy could be rebounding after a decline in May caught some off guard.
"This was everything you could have asked for, maybe more," Michelle Meyer, the head of United States economics at Bank of America Merrill Lynch, told the New York Times. "We're seeing new entrants into the labor market, which implies a longer runway for the business cycle."
The Labor Department’s report paints a more positive picture than numbers released last week that showed the country’s gross domestic product expanded only 1.2 percent during the April-June quarter.
The numbers could impact upcoming discussions among Federal Reserve officials about whether to raise interest rates, as well as the presidential campaign, where Democrats and Republicans have presented dueling narratives about the economy.
Stephen Miller, a senior policy advisor for Republican nominee Donald Trump, told The Wall Street Journal that the latest GDP figures point to a “shockingly weak recovery.”
But Jared Bernstein, an economist who served in the Obama administration, told the Times that the focus on GDP overlooks positive news about the labor market.
“The idea that Republicans are touting, that the job market is a wreck, is clearly belied by the data,” said Mr. Bernstein, now a senior fellow at the Center on Budget and Policy Priorities. “What matters most to people isn’t GDP growth, it’s jobs and wages.”
The Labor Department found that many different industries added jobs, including professional and business services – such as administrative or engineering jobs – as well as health care, finance, food service, construction, manufacturing, and government.
The mining and logging sector, which includes the oil and gas industry, was a notable exception, as it continued to decline, the Journal reports.
This spring, mining briefly sparked a political debate after a comment by Hillary Clinton that appeared to suggest that her push towards clean energy standards would “put a lot of coal miners and coal companies out of business.”
But Clinton’s full remarks, from a CNN town hall event in March, also acknowledged the economic challenge of changing the energy landscape. “Now we've got to move away from coal and all the other fossil fuels, but I don't want to move away from the people who did the best they could to produce the energy that we relied on,” she said, according to Politifact.
Other employment indicators were mixed. The Labor Department found that the number of people working part-time because they can’t find full time work increased 0.1 percent, to 9.7 percent in July, the Times reports, but that compares with a level of 10.4 percent a year earlier.
The average hourly wage for private sector workers increased 8 cents from June to July, rising to $25.69, compared with $25.03 in July 2015.
The report comes a day after the Labor Department found that the number of Americans filing new applications for unemployment, viewed as a proxy for firings, rose slightly last week.
The Labor Department said that initial claims for unemployment benefits rose 3,000, to a seasonally adjusted 269,000, in the week that ended on July 30.
But that was offset by a decline in the number of continuing claims, or workers who draw unemployment for more than a week.
That number, which is released with a week’s delay, fell by 6,000 in the week that ended July 23, to 2,138,000. A year earlier, it stood at 2,260,000, the Department said.
Overall, the picture appeared positive, said most economists.
"The July labor market report was exceptionally strong," Millan Mulraine, deputy chief US macro strategist at TD Securities, told the Journal, "and the warts were few and far between."
