July’s total payroll gain of 209,000 marks the sixth consecutive month of advances in excess of 200,000. The last six months have brought a total of 1.465 million new jobs—the largest increase since August 2005. Although gains in office-using employment (+56,000 in July) fell short of June’s upwardly-revised advance of 100,000 jobs, July’s figure is in-line with the trend in office-using employment over the past 12 months (Table 1 and Chart 1 on the following page). As has typically been the case, the gains in office-using employment stemmed almost entirely from increases in professional/business services workers (including an almost 9,000 increase in architectural and engineering service workers), although the contribution from the increase in temporary help services employees was less than half the typical monthly gain over the past year.
Table 1. Monthly Change in Office-Using Payrolls by Category (000s, SA)
Elsewhere, the Household Survey showed an increase of +0.1 percentage points in the unemployment rate to 6.2%, though the unemployment rate alone is hardly a robust measure of labor market slack. (The increase in the unemployment rate was due solely to an increase in the unemployment rate of adult women of +0.4 percentage points, as their labor force participation rate increased by +0.2 percentage points.) While the Household Survey also showed an increase in average weekly earnings to 2.6% in July, Employment Cost Index data released yesterday shows that the cost of labor, free from the influence of employment shifts among occupations and industries hasn’t begun to accelerate in a meaningful way on a year-over-year basis (Chart 2 on the following page), even if the 0.8% quarterly increase in wages/salaries for private industry workers was the most in more than six years. Nonetheless, wage growth in certain sectors, such as construction and transportation, is evident—a trend that bears watching in the months ahead.
Chart 1. Office-Using Employment and Total Payrolls, July 2007 – July 2014 (Seasonally-Adjusted, 000s)
Chart 2. Wages and Salaries by Occupation, Average Weekly Earnings and Consumer Price Inflation,YoY % Change of Quarterly Average