Employment grew by 187,000 in July, slightly below economist expectations, and the unemployment rate dipped one-tenth of a point to 3.5%, the U.S. Bureau of Labor Statistics reported Friday.
The job gains were less than the average monthly gain of 312,000 over the prior 12 months, but slightly over June's revised number of 185,000 jobs. In July, the job gains mainly occurred in the health care, social assistance, financial activities and wholesale trade industries. The professional and business services sector lost a total of 8,000 jobs in July, including 400 in accounting, tax preparation, bookkeeping and payroll services. That seems to be an anomaly, however. Monthly job growth in professional and business services had averaged 38,000 in the previous 12 months.
"The recently released jobs report for the accounting sector indicates a slight decrease of 400 jobs between June and July, a deviation from the consistent growth witnessed in the preceding months," said Werner Barnard, chief revenue and growth officer at Sapro, which provides workforce talent to public accounting firms. "While this dip may raise concerns among some industry stakeholders, it is crucial to view this development in the context of the broader positive growth trend observed in the sector throughout the entire year. The sector has, and will continue, to experience demand concentration that surpasses supply. Against that backdrop, I expect the demand to increase again after the summer (and before the resource planning cycle for the upcoming busy season). The accounting profession has proven its resilience time and again, and this temporary setback is likely a result of normal market fluctuations rather than a sign of a significant downturn."
Average hourly earnings increased 14 cents, or 0.4%, to $33.74 in July. Over the past 12 months, average hourly earnings have risen 4.4%.
The White House hailed the latest jobs report. "Unemployment near a record low and the share of working age Americans who have jobs at a 20-year high: that's Bidenomics," said President Biden in a statement. "Our economy added 187,000 jobs last month, and we've added 13.4 million jobs since I took office — more jobs added in two and a half years than during any president's four-year term. The unemployment rate is 3.5%, marking a full year and half below 4%. This follows recent news that our economy continues to grow, while inflation has fallen by nearly two-thirds and is at its lowest level in more than two years. We're growing the economy from the middle out and bottom up, lowering costs for hardworking families, and making smart investments in America."
The BLS revised downward the job numbers for May and June, lowering the total for May by 25,000, from a gain of 306,000 jobs to 281,000, and for June by 24,000, from 209,000 to 185,000 jobs added. With both revisions, employment in May and June combined was 49,000 lower than previously reported.
House Ways and Means Committee chairman Jason Smith, R-Missouri, found fault with the job numbers and pushed for an extension of the 2017 tax cuts.
"Since President Biden took office, our economy has struggled to return to the trend of employment levels that were booming prior to the pandemic, with labor force participation remaining flat for five months in a row," he said in a statement. "'Bidenomics' fueled a spike in the price of everything from gas to groceries to homes, and fighting it with interest rates, by design, puts the brakes on the economy, including the job market. The results have been a disaster for working families — fewer jobs, paychecks that don't buy as much as they used to, and rising costs for car loans and home mortgages. No matter the fake spin coming out of the White House, Americans know President Biden is pushing the economy off the ledge. Instead, Democrats should embrace Republicans' jobs plan to lock in the success of tax reform, get more Americans back to work, and grow our economy."
Rep. Richard Neal, D-Massachusetts, the top Democrat on the committee, sees the job report as a positive sign. "Today's jobs report signals our economy is stabilizing, yet wages continue to rise and unemployment fell — all fantastic news for our nation's workers," he stated. "As we look ahead to the one-year anniversary of the Inflation Reduction Act, record job growth was never guaranteed and it is Democrats' investments in workers, families and our public infrastructure that made it possible."
