ThinkWhy, a SaaS company helping businesses navigate the labor market, has released its U.S. monthly jobs report for July 2020. According to the Bureau of Labor Statistics (BLS), the U.S. economy gained 1.8 million jobs in July, a 63% decrease from June’s record number. Despite the sequential moderation, July 2020 still registered as the third largest month of job gain in U.S. history behind the back-to-back record-setting months of May (2.7 million) and June (4.8 million) this year.
The nation still has almost 13 million jobs to recoup from the early stages of the pandemic. As reported by the Census Bureau’s weekly household pulse survey, a stall in momentum began in late June as COVID-19 infection rates rose and impacted the pace of the recovery. Considering one-third of the jobs that remain open are in the leisure and hospitality industry, a sector that heavily relies on close proximity to people. Until the virus is under control, a more pronounced rebound will be difficult.
“The rise in COVID-19 numbers slowed the pace of economic rebound. Meanwhile, the pace of job gains have moderated and July’s job gain would be considered beyond robust in normal times, but it signals that the strength of recovery is highly dependent on our ability to contain the virus,” said Jay Denton, SVP, Business Intelligence and Chief Innovation Officer at ThinkWhy.
Labor Market Performance:
- Unemployment sits at 10.2%
- Temporary layoff level is 9.2 million
- July’s job gains concentrated in industries such as Leisure and Hospitality (592,000) and Government (301,000)
- In addition, total nonfarm payroll average hourly earnings increased by 0.2% year-over-year ending in July 2020
The U.S. economy has now gained more than 9.3 million jobs in the past three months. The question remains whether the economy can continue to gain significant traction. The most recent unemployment insurance claims report from August 6 shows signs of that a lull was occurring in the speed with which jobs were being refilled, as the trend line for claims was flattening. Then initial unemployment insurance claims fell below 1.2 million for the week ending August 1. It was the lowest weekly total for initial claims since the spike in March, and continued claims for the week ending July 25 dropped by 844,000 from the week before.
Why It Matters: Key Takeaways from the July Employment Report
July’s job gain of 1.8 million continued to fill the hole of jobs loss created in March and April, but there is still a lengthy road to make it back to the previous norm. Businesses will have to maintain strategic focus as they continue to navigate the period, from now until COVID-19 is under control.
As businesses plan for growth and look for new opportunities, they can:
- Keep a pulse on labor market performance and the impact to your location and industry.
- Focus on industry and metro growth performance to identify sales, marketing and business development opportunities.
- Evaluate talent and location strategies, including for remote hiring and know the pay differentials across markets.
- Measure timing and magnitude of job loss and recovery by industry and metro, as variances can dramatically impact investment and operational strategies.
- Leisure and Hospitality: Industry gains totaled to 592,000 jobs added for the month. The subsector of food services and drinking places accounted for most of the gain, with 502,000 jobs added.
- Trade, Transportation and Utilities: Gain within the industry was 291,000 jobs, upping its three-month total to more than 1.6 million jobs added since April. The retail subsector experienced the greatest impact, adding 258,000 jobs in July and has added almost 1.5 million jobs since April.
- Education and Health Care Services: Education added 23,500 jobs in July with healthcare subsectors in dental offices (45,000), hospitals (27,000) and offices of physicians (26,000) seeing the biggest lift in July.
- Professional and Business Services: Gains within this industry were 170,000 in July. Temporary-help services led with an additional 144,000 jobs.
- Manufacturing: Gain within this industry was 26,000 in July, still down 740,000 jobs compared to February.
- Government: Gain within this industry was 301,000, yet still remained 1.1 million below its level from February. Subsector impact resulted in job gain from federal government adding 45,000 jobs since February.
- Financial Activities: Gains within the industry were 21,000.
- Construction: Gains within this industry were 20,000.
To read the full report, click here.
ThinkWhy continuously monitors and forecasts labor data at all levels, measuring impact to MSAs, industries and businesses across the country, to support organizations and provide answers during the recovery phases. LaborIQ® by ThinkWhy® is a proprietary U.S. labor market reporting platform that also provides salary answers for over 19,000 jobs, customizable by metro, industry, education, experience and skills. For additional information on LaborIQ, please visit ThinkWhy.com.
ThinkWhy is helping companies navigate a new era of work by creating modern, human-centered software that supports better career lives. LaborIQ by ThinkWhy is the first platform to bridge the gap between salary answers and metro performance, delivering a strategic advantage to businesses. Learn more at www.ThinkWhy.com or follow us on Twitter and Instagram at @ThinkWhy_, on Facebook at @ThinkWhyLLC and LinkedIn at @ThinkWhy-LLC.