U.S. Economy Added 943,000 Jobs in July, Unemployment Rate Fell to 5.4% Robust job growth last month reflects a strong labor market ahead of the Delta variant threat
Nonfarm payrolls rose by a seasonally adjusted 943,000 in July, the best gain in 11 months, the Labor Department said Friday.
The unemployment rate, derived from a separate survey of households, fell to 5.4% last month from 5.9% in June to touch the lowest level since the pandemic took hold in the U.S. in March 2020. The latest data also showed some additional workers were drawn off the sidelines, and wages rose at a strong rate.
The surveys for the jobs report were conducted in the middle of the month. That was before some local governments reimposed mask mandates and other restrictions, and before many employers said they would require employees to wear masks, be vaccinated or get tested regularly. Companies have also delayed return-to-office plans, including announcements by Amazon.com Inc. and Wells Fargo & Co. (…)
The hospitality industry still has 1.7 million fewer jobs than in February 2020, a large share of the 5.7 million jobs employers have yet to recover from the pandemic downturn. (…)
Workers’ hourly wages rose 4% from a year earlier, a sign of a tight labor market. Wages for leisure and hospitality workers, the lowest paid group, increased nearly 10% from a year earlier. Many restaurants are offering bonuses and better pay to draw workers into the labor force. (…)
The participation rates are not improving: prime-age workers are coming back very slowly while he boomers keep retiring.
Average weekly payrolls (employment x hours x wages) rose 0.9% MoM in July after +1.0% in June and +0.6% in May. Last 3 months: +10.4% annualized. Payrolls are 4.2% above their pre-pandemic level even though total employment remains down 3.7%.
The only concern is inflation: total CPI is up 4.7% from February 2020. Core CPI: +4.2%. Since consumer expenditures tend to sync with labor income, rising prices, transitory or not, are threatening. July CPI is out this Wednesday.
The next move in inflation will likely come from the rent of shelter component
Canada’s Jobs Recovery Continues in July Amid Reopenings
The country’s economy added 94,000 jobs last month, Statistics Canada reported Friday in Ottawa. Economists were predicting a jobs gain of 150,000. The unemployment rate fell to 7.5% from 7.8% in July. (…)
July’s increase follows a 231,000 jobs gain in June; the two months reversed the 275,000 jobs lost during lockdowns in April and May.
Of the three million jobs lost at the start of the crisis, 2.74 million have now been recovered.
The Globe & Mail adds:
(…) The entirety of job creation in July was driven by the private sector, where employment rose by 122,700. Nearly all the new jobs had full-time hours. And long-struggling young Canadians picked up the bulk of positions. (…)
The labour force participation rate held steady in July at 65.2 per cent, a touch lower than before the pandemic started (65.5 per cent).
Jefferies Raises Junior Pay to Match Goldman Sachs The bank’s first-year analysts in the U.S. will now make $110,000, up from $85,000. Bonuses, typically handed out in August, are also expected to be high.
- Uber and Lyft Drivers Are Coming Back, but Prices Aren’t Falling Data show average fares were at a record in July despite an improvement in the pandemic-driven shortage of drivers.
China’s Producer Prices Jump Despite Efforts to Cool Commodities Costs Factory-gate prices rose at an unexpectedly fast clip in July, matching the highest level in more than 12 years as crude oil and coal prices soared—though economists say the price pickup is unlikely to last.
China’s producer-price index rose 9.0% from a year earlier, the National Bureau of Statistics said Monday—faster than June’s 8.8% year-over-year increase and the 8.8% gain forecast by economists polled by The Wall Street Journal.
July’s increase matched May’s 9.0% year-over-year jump, which marked the biggest surge in producer prices since September 2008.
On a month-over-month basis, China’s producer prices rose 0.5% in July, faster than June’s 0.3% advance. (…)
China’s consumer-price index rose 1.0% from a year earlier in July, down from June’s 1.1% gain, kept in check by food prices that fell 3.7% in July from a year earlier, compared with June’s 1.7% drop.
Nonfood prices rose by 2.1% in July, up from June’s 1.7% advance, lifted by soaring oil prices and higher hotel and travel expenses during the summer months, China’s statistics bureau said. (…)
- Oil Tumbles on Worries Over China Delta Variant Outbreak The price of oil and other key industrial commodities slid after measures to halt the spread of the Delta variant by the country’s government spooked investors about global energy demand.
China’s Export Machine Still Hums Despite Covid-19, Extreme Weather While export and import growth slowed in July, both were still strong.
(…) China’s export sector showed continued resilience, increasing 19.3% in dollar terms in July compared with a year earlier, data from the General Administration of Customs showed Saturday.
That marked a retreat from June’s 32.2% year-over-year gain, but was largely in line with the 20% growth forecast by economists polled by The Wall Street Journal. To some degree, the slower year-over-year percentage advance reflects a tapering off of flattering comparisons to the pandemic-hit economic figures early last year. (…)
In an article published Friday, Ning Jizhe, deputy director of China’s main economic-planning agency, the National Development and Reform Commission, warned that domestic demand growth was struggling with weaker momentum.
That gloomy picture was borne out to some degree by Chinese import data that were also released Saturday, showing imports rising 28.1% in U.S. dollar terms in July from a year earlier—short of June’s 36.7% pace, and economists’ median forecast of 31.7%.
Compared with 2019, a metric that Chinese officials have used to offset the distortions of the pandemic, imports and exports grew by 22.3% in the first seven months of the year, Chinese customs officials said Saturday.
Taken together, China’s trade surplus expanded to $56.6 billion in July, from $51.5 billion in June, according to official data. Economists had expected China’s trade surplus to come in at about $54 billion. (…)
Travelling today. Monday’s typical topics (earnings, technicals) will be posted tomorrow.