Economy Adds 162,000 Jobs in July, Unemployment Rate Dips to 7.4%
The Labor Department’s monthly jobs survey had some mixed results for July. The economy added 162,000 new jobs, a bit below expectations, and the unemployment rate ticked down slightly, from 7.6 percent to 7.4.
The report showed continued slow progress as the nation struggles to get back up to speed, economically. A Bloomberg survey of 93 economists had predicted a rise of 185,000 jobs, while those polled by Marketwatch foresaw a gain of 180,000. The July figure will likely be revised in the following months, but it may go either upward or downward. The May and June jobs numbers, for example, were revised downward by 26,000 in the July report.
The unemployment rate lowered two tenths of a point, but that’s due as much to people leaving the labor force as it is to job seekers finding new work. The 7.4 figure is the lowest it’s been since December 2008, but it still looks like it will be quite a while—some say as long as seven years—for the employment picture to return to its pre-recession levels, if it continues at this rate.
Another bit of bad news in the report is a drop in workers’ average hourly wages, from $24 to $23.98, along with a dip in average hours worked per week, from 34.5 to 34.4. These aren’t big losses, but they are signs of a struggling labor environment.
There are also some bright spots in the economic outlook. Consumer confidence continues to rise, and housing is enjoying a sustained comeback. Car sales reached 15.9 million and 15.6 million for June and July, respectively, the best two-month performance since 2007. And the Federal Reserve expects economic growth to pick up in the third quarter of the year, which should lead to a further drop in the unemployment rate. The Bloomberg survey of economists predicted GDP growth of 2.5 percent next quarter, as compared with 1.1 and 1.7 percent in the previous two.