Job Growth Slows Further in July

August 3, 2007

Job Growth Slows Further in July

Jobs Byte by Dean Baker 

For Immediate Release: August 3, 2007
Contact: Alan Barber, (202) 293-5380 x115 

Healthcare and restaurant employment account for almost 60 percent of private sector job growth since March.

The establishment survey showed the economy adding just 92,000 jobs in July, the weakest performance since February. However, the data are distorted by the timing of summer breaks for public school teachers. The private sector added 120,000 jobs in July, roughly the same pace as the prior two months. However, this growth is not fast enough to keep up with labor force growth. The unemployment rate edged up to 4.6 percent (4.647% before rounding). It had been at 4.4 percent in March.

While the rise in unemployment is very modest, drops in employment rates suggest that many workers are having difficulty finding jobs. The overall employment to population (EPOP) ratio edged down 0.1 percentage points to 63.0 percent in July; it had been at 63.3 percent in March. This drop is hitting prime age workers, with the EPOP for workers ages 25-54 falling from 80.3 percent in January, to 79.8 percent in July, 2.1 pp below the 81.9 percent peak in April of 2000. Within this group, workers ages 35-44 are seeing the largest falloff in EPOPs, dropping 1.0 percentage point (81.5 percent to 80.5 percent) since January. The decline for men in this age group was 1.1 pp compared to 0.8 pp for women.

Employment rates among older workers continue to rise. The EPOP for workers ages 55-64 is now 61.7 percent, 3.5 pp above the peak in 2000. Workers over age 55 accounted for 50.2 percent of the employment growth since April.