The household survey confirmed the weakness in payroll jobs. Though the unemployment rate ticked down, it fell because would-be workers left the labor force not b/c they got jobs. While the prime-age employment-to-population ratio rose slightly, it's now a half a percentage point below it's peak.

Nominal wage growth decelerates in July, rising just 3.2% over the year. Slowing nominal wage growth suggests workers don't have the leverage to bid up their wages. And, along with rising prices, workers and their families continue to find it difficult to make ends meet.

Although manufacturing employment ticked up slightly in July (+5k), manufacturing jobs are still down by 62k since January 2025. Instead of adding these blue collar jobs, the manufacturing sector has lost 62,000 jobs since Trump took office.

While public sector weakness in July was centered around state and local jobs, federal jobs ticked down by 3,000. Federal employment remains 327,000 below its January level. The vital services federal employees provide cannot be done without these essential workers (e.g. food inspectors). #EconSky

Large losses in the public sector in July (-53k), particularly in local education (-49.6k jobs). An initial look doesn't suggest an issue with seasonal adjustment because losses were also registered in NSA data for June and July. Local education jobs have fallen by nearly 100k (-98.3k) since March.

Weak #jobsreport all around -Nonfarm payrolls fell by 23,000 (mostly driven by state and local losses) -The unemployment rate ticked down for the "wrong" reasons as labor force participation and employment-to-population ratio softened -Nominal wage growth decelerated to 3.2% over the year #EconSky

Layoffs remain low despite anecdotal evidence. If layoffs begin rising while the hires rate remained depressed, it could mean unemployment spikes. But, as of yet, those concerns are not realized and upticks in certain industries seem to have been a blip in prior months and were not sustained.

The hires rate ticked up slightly in June, but remains on par with much weaker labor market conditions. At 3.4%, the hires rate more closely resembles the labor market in 2013 when the unemployment rate was over 7%—it's now 4.2%. It's difficult for unemployed workers to break into the labor market.

The number of job openings softened slightly in June, but has generally been rising over the year. Job openings remain near their pre-pandemic high but the job openings rate is a bit weaker compared to 2019 because employment levels have risen since then (as the working age population has grown).

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While there's been little change this year, federal employment has shrunk an alarming 324,000 jobs since January 2025. The vital services federal employees provide cannot be done without these essential workers. #NumbersDay #EconSky

Manufacturing employment is crawling along, gaining 3k jobs in June, all in durable goods. After downward revisions, manufacturing lost jobs in May. Since January 2025 when Trump took office, the manufacturing sector has lost 75,000 jobs. #EconSky

We won't get the inflation data for June until July 14, but recent price data suggest year over year real wages likely fell in June. Workers and their families are finding it increasingly difficult to make ends meet and real wages are most surely now below where they were in January 2025. #EconSky

Given expectations around the World Cup, it's surprising to me that leisure and hospitality fell by 61k in June (and May growth was revised down by 30k). Perhaps those gains are offset by reduced discretionary spending as real wages fall. #NumbersDay #EconSky

The household survey came in even weaker. While the topline unemployment rate ticked down, it happened for the wrong reasons as labor force participation fell by 720k while employment fell by 507k. Even the prime-age employment-to-population ratio, which had remained resilient, fell 0.6ppts in June.

Today's jobs report came in weaker than expected. The economy added 57k jobs in June and prior months were revised down. April and May are a combined 74k lower than previously reported. Analysts believe the World Cup added 40k to June numbers—without that, job growth would have been 17k. #EconSky

Year over year real hourly wages continued to fall in May. The CPI grew 4.2% in May, beating out nominal wage growth and leading to a 0.8% fall in real wages. Accelerating price inflation is the real culprit but decelerating nominal wage growth indicates a weakening labor market. #NumbersDay

While the diffusion of job gains has increased—which is good news—it remains below pre-covid levels. Since Jan 2025, all private sector gains can be accounted for by healthcare/social assistance (+56.3k avg jobs per month while all other private sector industries combined averaged 0 jobs per month).

Nominal wage growth continued to slow in May, now 3.4% over the year. While we don't get the May inflation data until next week, it's very likely, given recent trends, that real wages will continue to fall and workers and their families will find it increasingly difficult to make ends meet. #EconSky

While there's been little change this year, federal employment has shrunk an alarming 333k jobs since Jan 2025. The vital services federal employees provide cannot be done without these essential workers. #NumbersDay #EconSky

Manufacturing employment rose by 7,000 in May, slowly clawing back the large losses last year. Since January 2025 when Trump took office, the manufacturing sector has lost 68,000 jobs. #EconSky

After several months of bumpy employment growth, it's encouraging to see three months of stronger growth. Given this unexpected strength, some may question the validity of the data. At this point, there are no signs that these numbers are cooked or fabricated. #EconSky #NumbersDay

The latest jobs report came in stronger than expected this morning. The economy added 172,000 jobs in May and the unemployment rate held steady at 4.3%. Nominal wage growth continued to decelerate, further exacerbating affordability as prices rise. #EconSky #NumbersDay @epi.org

The depressed hires rate appears to be a key driver of labor market weakness for young workers—college or not—as it's harder to break into the labor market. The culprit is not likely AI-driven structural change but an economy where employers hire less and workers hold on to the jobs they have.

Young college grads—like overall college grads—are considerably more likely than young noncollege workers to work in AI-exposed occupations. But, remember that both young college and noncollege workers are experiencing similar labor market weakness, suggesting AI is not likely a leading factor.

What about AI? We employ a measure created by @budgetlab.bsky.social to investigate whether young college graduates may be more likely to be at risk in AI-exposed occupations than other workers. We plot the AI exposure of occupations weighted by the share of the entire workforce in each occupation.

A similar story emerges when we look at occupations. The top four occupations for job growth since 2023 account for 85% of young college graduate employment. These job gains are in professional, management, business, financial, services, and office and administrative support occupations.

The information sector—closely watched for AI-exposure—has seen an 8.5% employment decline since 2023. While these losses are striking, it cannot be overemphasized just how small this sector is: less than 2% of overall employment, including only 2.3% of young college graduates.

The types of jobs where young college graduates work look similar to those of college graduates generally. The two fastest growing sectors since 2019 occurred in the two largest sectors for young college graduates: private education and health services and professional and business services.

In the long run, the college degree is losing its edge: Unemployment for young college graduates has risen faster than the overall in part due to increasing educational attainment in the workforce writ large and the college wage premium has been flat or falling in recent years.