Meet the Author

Yoonsoo Lee |

Research Economist

Yoonsoo Lee

Yoonsoo Lee was formerly a research economist in the Research Department. His areas of research include macroeconomics, labor economics, and regional economics.

Meet the Author

Michael Shenk |

Research Assistant

Michael Shenk

Michael Shenk was formerly a research assistant in the Research Department of the Federal Reserve Bank of Cleveland. His work focused on international topics and housing-market indicators.

09.14.07

Economic Trends

The Employment Situation, August

Yoonsoo Lee and Michael Shenk

In August, the economy lost jobs for the first time since August 2003. The unemployment rate remains about the same but it is because both household employment (-316,000) and the labor force (-340,000) declined sharply. The drop of 4,000 jobs was considerably below the market expectation of about a 100,000 gain. In addition, job gains in the prior two months were revised down by a combined 81,000 jobs; the June number was revised down to 69,000 from 126,000 and the July number was revised down to 68,000 from 92,000. (See Revisions to Employment Report for more detail about the revision.) Accompanied with the downward revisions, this report suggests that there has been a noticeable slowing in employment growth during the summer months.

Labor Market Conditions

        Average monthly change
(thousands of employees, NAICS)
  2004 2005 2006 Jan-May 2007 June 2007
Payroll employment
172
212
189
148
132
  Goods-producing
28
32
9
–14
–3
    Construction
26
35
11
–3
12
    Manufacturing
0
–7
–7
–13
–18
      Durable goods
8
2
0
–12
–13
      Nondurable goods
–9
–9
–6
–1
–5
  Service-providing
144
180
179
162
135
    Retail trade
16
19
–3

13

–24
    Financial activitiesa
8
14
16
5
1
    PBSb
38
57
42
18
–9
      Temporary help services
11
18
–1
–8
–8
    Education and health services
33
36
41
46
59
Leisure and Hospitality
25
23
38
31
39
  Government
14
14
20
28
40
                 
  Average for period (percent)
Civilian unemployment rate
5.5
5.1
4.6
4.5
4.5

a.Financial activities include the finance, insurance, and real estate sector and the rental and leasing sector.
b. PBS is professional business services (professional, scientific, and technical services, management of companies and enterprises, administrative and support, and waste management and remediation services.
Source: U.S. Department of Labor, Bureau of Labor Statistics.