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An Encouraging Trend in U.S. Job Losses

0 248 Market Intelligence

According to government statistics, U.S. month-to-month total employment experienced its sharpest drop in January 2009, at -741,000 jobs. Since then, the pace of decline has slowed and in the latest month (July) it was a much better -247,000. It may seem odd to call a quarter of a million jobs lost encouraging, but in context and relatively speaking, it is. Total employment may still be sinking, but some sectors are experiencing more buoyancy than others.

According to government statistics, U.S. month-to-month total employment experienced its sharpest drop in January 2009, at -741,000 jobs. Since then, the pace of decline has slowed and in the latest month (July) it was a much better -247,000. It may seem odd to call a quarter of a million jobs lost encouraging, but in context and relatively speaking, it is.

Some Sectors are More Buoyant

Total employment may still be sinking, but some sectors are experiencing more buoyancy than others. Total U.S. employment has fallen by 6.7 million jobs since January of last year, a period of 19 months. Half of that total has been in manufacturing (-2.0) and construction combined (-1.4). The other half has been in the service sector (-3.3). (Story continued below)

U.S. : Month-to-Month Total Job Creation
U.S.
Over the past 20 years, the U.S. economy has generated, on average, 120,000 new jobs per month or 1.5 million new jobs per year.
Data Source: U.S. Bureau of Labor Statistics (Department of Labor).
Chart: Reed Construction Data - CanaData.

Services currently account for 86% of all jobs in the economy. Manufacturing jobs make up 9% of the total and construction is the remaining 5%. Of course, there is lots of overlap. The design community is relegated to services although it is essential to projects getting built. And much of manufacturing is geared towards making building products.

While total U.S. employment is -4.2% year over year, service sector jobs are a much less severe -2.6%. Total employment has now dropped back to its mid-2004 level. Services employment has fallen to only its early 2006 level. The year-over-year percentage changes in employment for construction and manufacturing are -14.6% and -12.2% respectively. None of the sub-sector service categories has experienced a double digit percentage decline.

Stability Appearing in the Percentage Declines

Low inventory levels will see manufacturing activity begin to climb in the months ahead. Public sector projects, an easing of credit and beginnings of recovery in housing will help construction employment. In services, a number of sub-sectors are already showing stability, if not improvement. Year-over-year percentage changes have apparently bottomed out for retail trade (at -4.1% since the start of this year), transportation and warehousing (-7.0%), financial activities (-5.1%), professional and business services (-6.6%) and leisure and hospitality (-2.1%).

Latest U.S. Employment Picture by Industry –
Levels and Year-Over-Year Percent Changes
U.S. Total Employment – Level
(Based on seasonally adjusted data)
U.S.
U.S. Total Employment – % Change
(Based on seasonally adjusted data)
U.S.
U.S. Construction Employment – Level
(Based on seasonally adjusted data)
U.S.
U.S. Construction Employment – % Change
(Based on seasonally adjusted data)
U.S.
U.S. Manufacturing Employment – Level
(Based on seasonally adjusted data)
U.S.
U.S. Manufacturing Employment – % Change
(Based on seasonally adjusted data)
U.S.
U.S. Service-providing Employment – Level
(Based on seasonally adjusted data)
U.S.
U.S. Service-providing Employment – % Change
(Based on seasonally adjusted data)
U.S.
U.S. Retail Trade Employment – Level
(Based on seasonally adjusted data)
U.S.
U.S. Retail Trade Employment – % Change
(Based on seasonally adjusted data)
U.S.
U.S. Transportation and Warehouse Employment – Level
(Based on seasonally adjusted data)
U.S.
Includes air, rail, water, truck, transit and pipeline transportation, plus warehousing and storage.
U.S. Transportation and Warehouse Employment – % Change
(Based on seasonally adjusted data)
U.S.
U.S. Financial Activities Employment – Level
(Based on seasonally adjusted data)
U.S.
Includes banking, finance and insurance firms, plus real estate and leasing activities.
U.S. Financial Activities Employment – % Change
(Based on seasonally adjusted data)
U.S.
U.S. Professional and Business Services Employment – Level
(Based on seasonally adjusted data)
U.S.
Includes legal, accounting, architectural, management and employment services, plus computer system design work.
U.S. Professional and Business Services Employment – % Change
(Based on seasonally adjusted data)
U.S.
U.S. Information Services Employment – Level
(Based on seasonally adjusted data)
U.S.
Includes publishing, motion picture and sound recording, broadcasting, telecommunications and Internet business.
U.S. Information Services Employment – % Change
(Based on seasonally adjusted data)
U.S.
U.S. Education and Health Employment – Level
(Based on seasonally adjusted data)
U.S.
U.S. Education and Health Employment – % Change
(Based on seasonally adjusted data)
U.S.
U.S. Leisure and Hospitality Employment – Level
(Based on seasonally adjusted data)
U.S.
U.S. Leisure and Hospitality Employment – % Change
(Based on seasonally adjusted data)
U.S.
U.S. Government Employment – Level
(Based on seasonally adjusted data)
U.S.
U.S. Government Employment – % Change
(Based on seasonally adjusted data)
U.S.
Data source: Payroll Survey, Bureau of Labor Statistics (U.S. Department of Labor).
Charts: Reed Construction Data - CanaData.

by Alex Carrick

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