Payrolls Top Forecasts
August 7, 2020
Total nonfarm payroll employment rose by
1.8 million in July, and the unemployment rate fell to 10.2 percent, the
U.S. Bureau of Labor Statistics reported today. These improvements in
the labor market reflected the continued resumption of economic activity
that had been curtailed due to the coronavirus (COVID-19) pandemic and
efforts to contain it. In July, notable job gains occurred in leisure
and hospitality, government, retail trade, professional and business
services, other services, and health care.
The results topped Wall Street
forecasts of 1.48 million jobs and 10.6% unemployment rate.
Household Survey Data
In July, the unemployment rate declined by 0.9 percentage point to 10.2
percent, and the number of unemployed persons fell by 1.4 million to
16.3 million. Despite declines over the past 3 months, these measures
are up by 6.7 percentage points and 10.6 million, respectively, since
Among the major worker groups, the unemployment rates declined in July
for adult men (9.4 percent), adult women (10.5 percent), teenagers (19.3
percent), Whites (9.2 percent), Asians (12.0 percent), and Hispanics
(12.9 percent). The jobless rate for Blacks (14.6 percent) showed little
change over the month.
The number of unemployed persons who were on temporary layoff decreased
by 1.3 million in July to 9.2 million, about half its April level. In
July, the number of permanent job losers and the number of unemployed
reentrants to the labor force were virtually unchanged over the month,
at 2.9 million and 2.4 million, respectively. (Reentrants are persons
who previously worked but were not in the labor force prior to beginning
their job search.)
Among the unemployed, those who were jobless less than 5 weeks increased
by 364,000 to 3.2 million in July, and the number of persons jobless 15
to 26 weeks rose by 4.6 million to 6.5 million. By contrast, the number
of unemployed persons who were jobless 5 to 14weeks fell by 6.3 million
to 5.2 million. The number of long-term unemployed (those jobless for 27
weeks or more), at 1.5 million, was little changed over the month.
The labor force participation rate, at 61.4 percent, changed little in
July, following increases in May and June. Total employment, as measured
by the household survey, rose by 1.4 million in July to 143.5 million.
The employment-population ratio rose by 0.5 percentage point to 55.1
percent but remains lower than in February (61.1 percent).
In July, the number of persons who
usually work part time rose by 803,000 to 24.0 million, while the number
who usually work full time, at 119.5 million, was little changed. (
The number of persons employed part time for economic reasons (sometimes
referred to as involuntary part-time workers) declined by 619,000 to 8.4
million in July, reflecting a decline in the number of people whose
hours were cut due to slack work or business conditions (-658,000). The
number of involuntary part-time workers is 4.1 million higher than in
February. 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. This group includes persons
who usually work full time and persons who usually work part time.
In July, the number of persons not in the labor force who currently want
a job declined by 463,000 to 7.7 million; this measure is 2.8 million
higher than in February. These individuals were not counted as
unemployed because they were not actively looking forwork during the
last 4 weeks or were unavailable to take a job.
Among those not in the labor force who currently want a job, persons
marginally attached to the labor force fell by 492,000 to 2.0 million in
July. These individuals were not in the labor force, 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.
Discouraged workers, a subset of the
marginally attached who believed that no jobs were available for them,
numbered 665,000 in July, essentially unchanged from the previous month.
Establishment Survey Data
Total nonfarm payroll employment rose by 1.8 million in July, less than
the increases of 4.8 million in June and 2.7 million in May. In July,
nonfarm employment was lower than its February level by 12.9 million, or
8.4 percent. The largest employment increases in July occurred in
leisure and hospitality, government, retail trade, professional and
business services, other services, and health care.
Employment in leisure and hospitality increased by 592,000, accounting
for about one-third of the gain in total nonfarm employment in July.
Employment in food services and drinking places rose by 502,000,
following gains of 2.9 million in May and June combined. Despite the
gains over the last 3 months, employment in food services and drinking
places is down by 2.6 million since February. Over the month, employment
also rose in amusements,
gambling, and recreation (+100,000).
Government employment rose by 301,000 in July but is 1.1 million below
its February level. Typically, public-sector education employment
declines in July (before seasonal adjustment). However, employment
declines occurred earlier than usual this year due to the pandemic,
resulting in unusually large July increases in local government
education (+215,000) and state government education (+30,000) after
seasonal adjustment. A July job gain in federal government (+27,000)
reflected the hiring of temporary workers for the 2020 Census.
In July, retail trade added 258,000 jobs. Employment in the industry is
913,000 lower than in February. In July, nearly half of the job gain in
retail trade occurred in clothing and clothing accessories stores
(+121,000). By contrast, the component of general merchandise stores
that includes warehouse clubs and supercenters lost jobs (-64,000).
Employment in professional and business services increased in July
(+170,000) but remains 1.6 million below its February level. The
majority of July's gain occurred in temporary help services (+144,000).
In July, the other services industry added 149,000 jobs, with most of
the increase occurring in personal and laundry services (+119,000).
Since February, employment in other services is down by 627,000.
In July, health care added 126,000 jobs, with employment growth in
offices of dentists (+45,000), hospitals (+27,000), offices of
physicians (+26,000), and home health care services (+16,000). Job
losses continued in nursing and residential care facilities (-28,000).
Employment in health care is down by
797,000 since February.
In July, employment in social assistance increased by 66,000, with child
day care services accounting for most of the gain (+45,000). Employment
in social assistance is 460,000 lower than in February.
Employment in transportation and warehousing rose by 38,000 in July,
following an increase of 87,000 in June. Despite job gains over the past
2 months, employment in the industry is down by 470,000 since a recent
peak in January. In July, employment rose in transit and ground
passenger transportation (+20,000), air transportation (+16,000), and
couriers and messengers (+9,000).
Manufacturing employment increased by 26,000 in July. An employment gain
in motor vehicles and parts (+39,000) was partially offset by losses in
fabricated metal products (-11,000), machinery (-7,000), and computer
and electronic products (-6,000). Although manufacturing has added
623,000 jobs over the past 3 months, employment is 740,000 lower than in
Financial activities added 21,000 jobs in July, with most of the gain in
real estate and rental and leasing (+15,000). Since February, employment
in financial activities is down by 216,000.
In July, construction employment changed little (+20,000), following job
gains of 619,000 in May and June combined. However, employment in the
industry remains 444,000 below its February level.
Mining continued to shed jobs in July (-7,000), reflecting a loss in
support activities for mining (-11,000). Mining has lost 127,000 jobs
since a recent peak in January 2019, although nearly three-fourths of
this decline has occurred since February 2020.
July, average hourly earnings for all employees on private nonfarm
payrolls rose by 7 cents to $29.39, following large changes in recent
months. Average hourly earnings of private-sector production and
nonsupervisory employees decreased by 11 cents to $24.63 in July. The
large employment fluctuations--especially in lower-paid industries--over
the past several months complicate the analysis of recent trends in
average hourly earnings.
The average workweek for all employees on private nonfarm payrolls
decreased by 0.1 hour to 34.5 hours in July. In manufacturing, the
workweek rose by 0.7 hour to 39.7 hours, and overtime increased by 0.3
hour to 2.8 hours. The average workweek for production and
nonsupervisory employees on private nonfarm payrolls was unchanged at
The change in total nonfarm payroll employment for May was revised up by
26,000, from +2,699,000 to +2,725,000, and the change for June was
revised down by 9,000, from +4,800,000 to +4,791,000. With these
revisions, employment in May and June combined was 17,000 higher than