This Is the Job Market We’ve Been Waiting For

Look for the new numbers to become central to debates over whether expanded unemployment payments have been a factor in holding back job creation by incentivizing people not to work. Many states suspended those expanded benefits earlier in the summer, which would be reflected in the July data.

The early verdict? Maybe. The steep decline in the number of people unemployed — 782,000 people — is certainly consistent with people returning to work instead of receiving jobless benefits. But the strong and steady growth in payroll employment in May and June is not what you would expect to see if unemployment benefits (or the lack of them) were the primary driver of the labor market.

Either way, we’ll know more when state-level data is released in coming weeks.

Education employment in public and private schools contributed a combined 261,000 jobs, but not because schools went on a strange midsummer hiring binge.

In the normal seasonal pattern, many teachers and other educators fall off their schools’ payrolls at the end of the academic year, which the Labor Department’s seasonal adjustment procedures account for. But with many schools closed or in limited operation this academic year, there were fewer people losing their jobs, meaning the seasonal adjustment appears to report a misleading gain in the number of jobs.

There are still plenty of problems in the United States economy, and it would be foolish to think that a single month of data, or even a few good months in a row, signaled a healing of the scars of the pandemic recession. Among other things, the share of the adult population working remains 1.7 percentage points below its prepandemic level. And the labor force participation rate barely edged up in July.

But there’s little question, when the employment numbers are combined with other recent data, that the trends are heading in the right direction.

Article source: https://www.nytimes.com/2021/08/06/upshot/jobs-report-strong.html