Observations:
The new jobs for August 2024 came in at 142,000 up from June's prior month total of 114,000. 142,000 is a moderate total and was somewhat below the 1977-2016 average. The lower total will further reinforce the anticipation that the Fed will decrease rates at its next meeting on September 18 meeting.
August's 142,000 is very close to the median of all monthly totals from 1977-2020.
The Dept of Labor uses 11 job sectors, they are listed below as columns and are arranged in order of largest percent of total jobs in the economy---see green bars. The first 4 sectors account for nearly 67% of ALL JOBS.
New jobs in August are the percent in the red bars. If the green and red bars are about equal, that means that the sector produced new jobs in proportion to that sector's overall employment.
The red bars exceed the green bars for Private Ed & Health representing 15% of all jobs but yet accounted for 33% of the new jobs in August. In July it was 50%.
June's total was adjusted down by a large 61,000 in August. July's initial total of 114,000 was adjusted down by a relatively large 25,000. July total will be subject to one more adjustment come October 4 when it will be finalized.
The Fed meets on September 18. It is clear that the jobs market has slowed which will give the Fed more options in reducing rates as they have already indicated.
The issue is will the reduction be 25bp or 50bp. While economics may warrant a 50bp cut, I suspect they will go with a 25pb reduction given how close we are to an election and their preference to be seen as being politically neutral. The election is Nov 5 and the Fed has a meeting two days latter on Nov 7. That gives them more options and less of a political spot light to operate in. Best, Bill
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