Unemployment barely declined to 4.22% in August from 4.25% in July., so those expecting a significant decline in unemployment because of weather-related effects in July were disappointed.
The slight decline is due to temporary layoffs as expected because of the outside surge in July
- After contributing 14bps to the July increase, temporary layoffs (“Job Losers on Layoff”) subtracted -11bps from the August unemployment rate.
- Job losers have accounted for 41bps of the 79bps increase in the unemployment rate since April 2023, with Reentrants (+22bps) and New Entrants (+12bps) combining for 34bps of the increase.
Full time employment continues to trend lower, while part-time employment \ for economic reasons is on the rise.
- Full time employment declined -438K, -0.76 Y/Y. It has come down ~1.5 Million since the peak.
- Part-time for economic reasons increased by 264K in July, 14.43 Y/Y.
The weakness in native-born jobs continues. The data seems to indicate a clear replacement phenomenon. However, demographics could be playing a role here too.
The faster increase of foreign born jobs seems to be happening since 2007, but after covid it got worse, with native-born not recovering yet.
- In just August, 635k immigrants (legal and illegal) gained a job. Meanwhile, 1.325 MILLION native-born Americans LOST their job.
