THE national economy added 204,000 private sector jobs in August, according to ADP’s monthly employment report published this morning. It is the 5th straight month of job gains over 200,000.
From Mark Zandi, chief economist at Moody’s Analytics:
“Steady as she goes in the job market. Businesses continue to hire at a solid pace. Job gains are broad based across industries and company sized. At the current pace of job growth the economy will return to full employment by the end of 2016.”
Here is a quick breakdown of the jobs gains by firm size:
- Small Businesses (1 – 49 employees): 78,000
- Medium Businesses (50 – 499): 75,000
- Large Businesses (500+): 52,000
- Goods producing: 41,000
- Service providing: 164,000
And by industry:
- Construction: 15,000
- Manufacturing: 23,000
- Trade/trans./utilities: 28,000
- Financial activities: 5,000
- Prof./business services: 51,000
While the labor market continues to improve, there is still plenty of slack, despite what Zandi and others say. Wages are stagnant (a key signal to how tight the labor market is), while new research highlights how under-employment is problematic (and no, increasing the supply of skilled labor is not the panacea).
In short, improvements in the labor market are not an indication of overall health; just how big of a hole we’ve been (slowly) digging out of.