With the release of June nonfarm payroll (NFP) numbers, it is time of an update of our chart of year-on-year employment growth:
June’s NFP employment was up 2.2 million from a year earlier, an increase of 1.5%. This marks the 88th month of consecutive year-on-year growth (for comparison, the 1990s expansion saw 111 months of consecutive year-on-year growth). A year ago, the June 2016 figure was an increase of 2.5 million and 1.7% from a year earlier. While employment growth continues, the pace of growth has been slowing since the current expansion’s peak in February 2015 when nonfarm payroll employment was up by 3.1 million and 2.3% from a year earlier.
NFP employment growth for the first half of 2017 was a seasonally adjusted 1.079 million, virtually unchanged from the first half of 2016 (which saw growth of 1.081 million). At the industry level, though, there are some significant changes in employment growth. See this table showing employment growth in thousands and the percent contribution to overall employment growth by industry for the first half of both 2016 and 2017:
Here are some industry-level observations:
- For both the first half of 2016 and 2017, the bulk of employment growth was in Professional and business services, education and health services, Leisure and hospitality: 64.4% for 2017H1 and 63% for 2016H1.
- Mining and logging, which is actually mostly related to oil and gas, went from losing jobs in 2016H1 to adding jobs in 2017H1.
- Construction’s contribution to job growth in 2017H1 was almost double that of 2016H1.
- Manufacturing went from losing jobs in 2016H1 to adding jobs in 2017H1. The gains were concentrated in these subsectors: primary metals, fabricated metal products, machinery, food manufacturing.
Trade, transportation, and utilities contributed a mere 1.4% to employment growth in 2017H1 compared to 15.4% in 2016H1. This is due a dramatic reversal in retail employment growth: a loss of 36,000 jobs for 2017H1 compared to adding 147,000 jobs for 2016H1.
- Information swung from contributing 1.7% to employment growth in 2016H1 to subtracting 4.0% in 2017H1. These job losses were concentrated in motion picture and sound recording, and telecommunications.
- The contribution from local government dropped from 8.6% in 2016H1 to 5.6% in 2017H1.