RESOLVING THE LEDGER
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New labor data shows the U.S. economy lost 23,000 jobs in July, when economists had predicted modest growth. Revised numbers for May and June also show 103,000 fewer jobs created than originally reported. The unemployment rate ticked down, from 4.2% to 4.1%, a function of fewer people seeking jobs. Amna Nawaz discussed the numbers with Heather Long, chief economist with Navy Federal Credit Union. New labor data out today shows the U.S. economy lost jobs last month when economists had predicted modest growth. In all, there was net loss of 23,000 jobs in July. Newly revised numbers from May and June also showed 103,000 fewer jobs created than originally reported. The unemployment rate ticked down from 4.2 percent to 4.1, a function of fewer people seeking jobs. Joining us with a look at what the numbers mean is Heather Long. She's the chief economist with Navy Federal Credit Union. Great to see you. Heather Long, Chief Economist, Navy Federal Credit Union: Thanks for having me. Amna Nawaz: So this is not the jobs report many people were expecting. Where do you see the biggest weaknesses here? Heather Long: Yes, this was a real wakeup call, definitely a bleak report. As you pointed out, it wasn't just week in July with those losses. And they were pretty broad-based. Hospitality sector lost jobs. Education lost jobs. Retail, and even the financial sector, I mean, with the stock market doing so well, lost jobs. But you also had revisions down, as you mentioned, in May and June. And I think that's what really shifted the view on Wall Street and here in Washington about how well this economy is actually doing. The belief was that things were maybe getting a little better, that hiring was picking up, and that's really been dashed after this report. Amna Nawaz: Let's dig a little deeper into some of those. Job losses and hospitality in particular, how much of that would you attribute to the World Cup, which was largely played in the U.S. and ended in July? Heather Long: Yes, it was definitely surprising to see job losses and hospitality in June and July. And I think it's both supply and demand. I know economic-speak here, but some of it is the affordability crisis. Families just aren't going out to eat as often as they were before. And then, of course, the Tartan Army has left Boston. You don't have people kind of drinking the bars dry anymore. Amna Nawaz: Yes. Heather Long: I think also supply, labor supply is impacting hospitality. What I mean by that is, look, we all know what's going on with immigration policy. There are a lot of immigrants who traditionally work in the hospitality sector. Some places are reporting difficulty finding enough workers now. Amna Nawaz: That's where you're seeing the crackdown show up in the data. Heather Long: Yes. Amna Nawaz: There were some areas of growth, we should point out, health care, construction, modest growth in manufacturing. What do those numbers tell us? Heather Long: This is -- health care is an ongoing story. It's been the one bright spot in the job market for the past two years. Hey, we got an aging population. That's pretty explanatory. Construction is interesting. That's been a real pickup this year. It's the A.I. boom. These construct -- big data centers are going up across the country, and it's been a revival for construction and manufacturing. After a real slump last year, manufacturing has gained about 30,000 jobs so far this year. It's not a ton, but you got to build the machines to build the data centers and to build all those factory parts inside. Amna Nawaz: I know another data point, a trend you have been tracking closely is women in the work force. We saw in these last month's numbers, a continuing decline of the number of women in the work force. The National Women's Law Center was actually out with a recent analysis that found over 845,000 women have left the labor force this year. That's compared to 400,000 men. What is going on here? Heather Long: I think it's really worrying. What you're seeing really in the past two years is that women with young children are leaving the labor force. They're just throwing up their hands and saying, I can't do it anymore, and particularly women with children 5 and under. And that's both college-educated women, who used to have those work-from-home jobs, and now they're being told they have to return the office, but also non-college-educated women who work in retail and education and other sectors that used to be giving them more opportunity, more flexibility. And now it's you have to be there from 9:00 to 5:00 or whatever those hours are. And you can see with the childcare that are so expensive and less flexibility, women can't do it. The other alarming point in this jobs report that kind of goes alongside that, wage growth weakest in five years, 3.2 percent. That is totally wiped out by inflation. That financial squeeze is real for a lot of households. Amna Nawaz: We hear that from a lot of folks we talk to out in the country. And I want to ask you too about the job seekers, because we did see the number of people who consider themselves in the work force, that also dropped. What should we understand about that? Heather Long: Yes, that was the lowest in five years for labor force participation. I will say that it's mainly folks who are retiring, some willingly, some forced, they can't find a job, 55-plus. And the other interesting one, young people still struggling a lot, and of course, the immigration factor. Foreign-born workers are definitely down due to the White House immigration policies. The one encouraging number in this report, let's call what would -- economists call, we have some of not the greatest names for things, but prime-age labor force participation, so workers between the ages of 25 and 54, that did rebound a little bit. So, again, that's where you see people in their prime working years who have a job. They are clinging to that job right now. Amna Nawaz: That's chief econo...
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