The U.S. labor market kept chugging along in July, with the economy adding 215,000 jobs and the unemployment rate steady at 5.3%, according to the latest employment situation report from the Labor Department.
The numbers were pretty much in line with economists expected. Other indicators in the report, such as average hours worked (increased by 0.1 hours), and average hourly earnings (up 5 cents per hour), also showed progress — but of the unspectacular kind.
These data come just five weeks ahead of the Federal Reserve’s September meeting, when many analysts expect the central bank to begin raising interest rates for the first time since 2006.
Job growth over the past year has been better than at any point since the recession, and the jobless rate is close to the average estimate for full employment since World War Two. But the latest economic data aren’t making Americans feel better about the economy. A recent Gallup poll showed that 56% of Americans think the economy is getting worse, up from 44% in January.
The likely cause for this pessimism? Americans just aren’t getting a raise. The most recent Employment Cost Index report showed the lowest increase in employee compensation on record. Meanwhile, recent revisions of GDP data have shown that economic worker productivity growth was much worse following the recession than we previously thought.
Despite this slew of bad news, Fed officials have stressed that they’re still prepared to raise rates this year, an admission that they don’t believe they have the tools to fix what ails the American labor market.
The U.S. economy added a healthy number of jobs last month, but by all indications they weren’t very good jobs. And neither policy makers nor technocrats seemed to have the slightest idea what to do about it.