The latest unemployment figures were released on Friday, and they don’t bode well for Kamala Harris’s job prospects.
Newsweek reported U.S. employers added only 142,000 jobs in August. In July, U.S. employers added 114,000 jobs—far less than expected, especially when compared to the 2024 average of 203,000 monthly job gains.
During the same month, the unemployment rate rose to 4.3 percent—the highest level since November 2021.
"Headline nonfarm payroll growth of 142,000 was marginally weaker than the expected change of 165,000, and the previous two months of data were also revised down by a combined 86,000. Hence, July's already weak 114,000 print is now just 74,000," William Blair's macro analyst Richard de Chazal wrote in a statement shared with Newsweek.
"One of the problems with the employment report at the moment is that the recent large -818,000 revisions are only preliminary and will not be fully incorporated into the data until February's final revisions next year," he added. "The large overstatement leaves the market guessing just how overstated the current batch of numbers might also be: 50,000-100,000 per month?
"Today's revisions to the past two months of payroll data only help confirm this weakness. In this case, growth is already below levels that are associated with the rate that is needed to keep the unemployment rate unchanged."
The report was widely considered crucial for both Wall Street and Kamala Harris' presidential campaign, observed Newsweek's Giulia Carbonaro.
Let’s sift the key fact out of the “macro analysis.” The already weak July jobs report has been revised DOWNWARD by over 50%. Cutting the jobs created estimate down to 74,000 means that in the entire country – all 50 states – fewer jobs than the population of Florida’s famous retirement community The Villages (83,719) were created.
But it gets worse.
Breitbart’s John Carney and Alex Marlow did a deeper dive into the numbers and noted that the three-month average is now a tepid 116,000. That’s a far cry from the 202,000 monthly average we saw last year.
If we narrow that down to the private sector, employment grew by 73,900 in August, falling short of the consensus forecast of 136,000. What's more, the prior month's private sector figure was revised down from a lukewarm 97,000 to a chilly 74,000. The three-month average is now just 96,000. This suggests that businesses are not expanding payrolls, indicating a weakening demand for labor, Carney and Marlow observed.
Go a step further and subtract the so-called government-adjacent sector of health care and social assistance, and private payroll growth drops to just 73,900. After revisions, the July figure was just 15,200, bordering on contraction territory, and the June figure was 28,3000.
That brings the three-month average down to just 39,100, one of the weakest three-month periods outside of outright recessions and employment contractions recorded in data going back to 1990.
This means that there are no more Americans who say they are employed than there were
one year ago.
Indeed, as our friends at Americans for Limited Government noted, unemployment is actually up by 1.4 million since its Dec. 2022 low, and the unemployment rate has gradually ticked up over a similar period, from an April 2023 low of 3.4 percent to the current level of 4.2 percent.
The latest data from the Bureau of Economic Analysis’ household survey shows for the month of August, with 161.43 million saying they have jobs, compared to 161.5 million in Aug. 2023. On a year over year basis, that’s actually 7,000 fewer jobs than a year ago, according to ALG’s analysis
Generally, whenever overall employment begins decreasing on a year over year basis, as it is now, it suggests a recession is imminent.
So, what’s the bottom line?
Rising unemployment takes away the one good story that Kamala Harris had to tell about the economy and recovery after COVID and it will be very interesting to see how she tries to spin it in tomorrow's debate with former President Donald Trump.
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