The Bureau of Labor Statistics issued the July Jobs Report on Friday, which revealed that the unemployment rate dropped to 3.5 percent in July, a fifty-year low. NAFCU Chief Economist and Vice President of Research Curt Long analyzed the report in a new NAFCU Macro Data Flash report.
“The July jobs report was a summer scorcher, and will likely be seen as uncomfortably warm for policy makers focused on cooling off inflation,” said Long.
Total jobs advanced by 528,000 in the month. In addition, results among every major private sector industry were mostly positive. Education and Health led the way with 122,000 jobs, followed by Leisure & Hospitality (+96,000), and Professional Business Services (+89,000).
Labor force participation declined by a 0.1 percentage point to 62.1 percent. Average hourly earnings grew by 15 cents in June, while year-over-year wage growth was at 5.2 percent.
“An economy adding over 500,000 jobs per month is not one that’s in a recession,” noted Long. “But wage gains show no sign of weakening, and that does not bode well for a Federal Reserve tasked with reining in inflation.”