Dive Brief:
- The U.S. gained an estimated 130,000 nonfarm jobs in August, according to the U.S. Department of Labor's Bureau of Labor Statistics (BLS) monthly jobs report. August's job growth is the lowest since May, falling below July's revised total of 159,000 and June's adjusted 178,000. The unemployment rate has held steady at 3.7% for three consecutive months, BLS said.
- In August, job growth was notable in professional and business services (+37,000) and the federal government (+28,000), due mostly to the hiring increase of temporary workers to help with the 2020 census, BLS said. Healthcare (+24,000) and financial activities (+15,000) employment also increased. Little change occurred in construction and manufacturing. The retail sector shed 11,000 jobs, BLS found. The labor force participation rate reached 63.2% in August, but overall has not changed much this year, according to the report.
- Job growth was less than the 150,000 economists predicted, reported Axios. The slowdown in growth indicates a possible retrenchment in hiring — exacerbated by the U.S. trade war with China and the Federal Reserve's recent interest rate cuts, Axios said.
Dive Insight:
Job growth declined for two consecutive months, raising concerns about a broader hiring slowdown and a possible economic downturn.
Predictions for the economy, however, are all over the map. Some stakeholders maintain a positive outlook on the economy, insisting that it remains solid despite predictions of a forthcoming recession. Still, some CEOs and company executives in a January Conference Board report said they're worried about the possibility of a recession. The August jobs report, with its less-than-stellar overall job gains, could reflect that some businesses are cutting back on hiring due to these concerns. In fact, Axios reported that hiring has slowed — even during a period marked by talent shortages — because U.S. job gains fell from a monthly average of 223,000 in 2018 to 158,000 in 2019.
If a recession is on the way, HR must be ready for the economic downturn. Bhushan Sethi, partner and joint global leader of PwC's People and Organization practice, told HR Dive in February that HR leaders must anticipate the fear and anxiety workers could feel if organizations are forced to cut staff, products or processes. Sethi recommended using effective communications tools to keep all stakeholders, including employees, customers and vendors, apprised of changes. He also said talent pros and HR departments can shift their focus to the future skills needs of their organizations at this time.
