The weekly employment growth slowed in August, and the overall increase in the number of people was significantly lower than expected.inside Ministry of Labor After the data update, the number of new non-agricultural jobs in the US economy reached 275,000, while the Dow Jones Index forecasted 720,000. NBC Finance Channel.
According to a report by the Department of Labor, an average of 586,000 job vacancies per month were created by employment growth. The number of jobs added in July was 1.1 million, compared with 962,000 in June, indicating how bad August’s performance was.
One bright spot is that the overall unemployment rate fell slightly from 5.4% to 5.2%, continuing the trend of the United States steadily converging to pre-pandemic lows.
Why the rate of recruitment slowed so significantly in August is still an open question. It is estimated that the current number of vacant jobs is close to 10 million, but employers often complain that they cannot find people to fill these vacancies.in a Recent survey, American CFOs lamented that recruitment is more difficult than before, and 95% of CFOs surveyed agree with this view.
The direct cause of the stagnant recruitment may be related to the COVID-19 Delta variant. Delta’s infections and hospitalizations have skyrocketed, but company executives said the virus hasn’t changed their prospects much. Fed officials In recent weeks, they have also stated that they believe that COVID-19 is still a challenge, but believe that the economy is adapting to it.
Unemployment assistance is another frequently cited reason for restricting recruitment. Supporters of this argument include the Republican governors of many large states, who believe that federal unemployment benefits prevent people from returning to work.Some states cut unemployment assistance ahead of schedule, but the data shows Not shown Compared with states that maintain aid programs, it greatly facilitates recruitment. As the economy continues on the road to recovery, the federal unemployment plan will expire on September 10.
The problem may be weak unmet demand, which has exacerbated inflation concerns throughout the summer. The pandemic continues because it has disrupted the global supply chain, and this situation continues into the fall, when retail centers usually place orders during the winter shopping season. In fact, the Department of Labor’s report shows that the largest unemployment occurred in the retail sector, with 29,000 jobs being lost, which adds a certain degree of credibility to this perspective.
August is also the last month of summer. The industries that benefit the most from this season, such as tourism or leisure, are slowing down as parents take their children back to school and back to the workplace. These sectors have not changed, but the Department of Labor pointed out that this is not a sign of the health of the sector, but the result of the gains in one area being offset by the losses in another.
The Fed will pay close attention to the employment report before its next policy meeting later this month. Chairman Jerome Powell (Jerome Powell) announced last week that the Fed may reduce monthly asset purchases on an unspecified date, but the decline in hiring may make the Fed worry that it will not take major actions.
