Don’t be misled by the seemingly solid payroll gain of 227,000. Today’s Jobs Report offers little evidence of a labor market rebound.

Today’s weaker-than-expected jobs report not only reflected the effects of storms and strikes, but also of the continued labor market cooldown which has taken place since the Fed began raising interest rates more than two years ago.

The U.S. economy added 142K jobs in August, but totals for the prior two months were revised downwards by a combined 86K, leaving the overall picture much the same. The labor market has slowed and slackened over the past three months, with job growth in the private sector outside of healthcare and social assistance falling to an unusually slow pace.

There are two main takeaways from today’s Jobs Report. The first is that labor markets in the private sector excluding healthcare and social assistance have deteriorated rapidly and are now anemic. The second is that American households are feeling the effects.

There are two main takeaways from today’s Jobs Report. The first is that the labor market has cooled off significantly. The second is that leading indicators in the report and from other sources signal further cooling ahead. 

May’s Jobs Report came in hotter than expected, with the economy adding 272K payrolls across a broad range of industries.

After what looked like a reacceleration in the first quarter, today’s Jobs Report shows the labor market returning to its prior trend of gradually normalizing job growth and wage growth.

As predicted by recent uptick in online job postings, today’s jobs report is strong across the board, with 303K jobs added in March, and the prior two months’ figures revised upwards by a combined 22K.

Exactly as we predicted, the February Jobs Report reversed earlier indications of an accelerating labor market and instead showed a market that continues its gradual cooldown.

Today’s Jobs Report was truly striking, beating expectations for January and revising 2023 job gains upwards. It was also somewhat confusing, containing indicators of remarkable labor market strength alongside concerning indicators of weakness.

Friday’s Jobs Report was mixed, with solid job gains (+216K) and wage growth (4.1% over the year) in the establishment survey, but weak employment growth (just +72K) and participation-related figures in the household survey. Factoring in downward revisions to the prior months’ figures, the 3-month average job gain was 165K, right in line with the 2019 average, suggesting that the labor market has come back to pre-pandemic normal.

The November Jobs Report was largely consistent with what economists were expecting.

It is hard to find any bad news in today’s jobs report. With an acceleration in job growth to 336K payrolls in September and upward revisions for the prior months, the jobs data is finally consistent with real-time estimates of third-quarter GDP growth. Together, they suggest a summertime boom.

According to today’s Jobs Report, the labor market overall is continuing to soar at an ideal cruising altitude—high enough to keep the unemployment rate below 4% while creating more opportunities for workers to come in off the sidelines, but low enough so as not to cause a resurgence of inflation.

The July jobs report was yet another goldilocks report, showing both cooling and continued resilience in the labor market. The economy added 187K jobs, and the unemployment rate edged down to 3.5%.

June is a huge month for hiring—for summer jobs, new college graduates, and teens. Given strong recent growth in air travel, restaurant dining, and hotel occupancy—paired with a 15% year-to-date increase in the stock market and a recent rebound in consumer confidence—the June Jobs Report was poised to be another blowout. Instead, it showed signs of the labor market cooling—perhaps the result of the Fed’s rate hikes finally biting.

A contradictory May Jobs Report sent mixed signals about the state of the U.S. labor market. The establishment survey was a blockbuster, reporting a 339K payroll job gain; the household survey was a downer, reporting a 310K employment loss and an unusually large increase in the unemployment rate from 3.4% to 3.7%.

The U.S. labor market has now beaten expectations for over a year.