July looks like it will be another extraordinary month for job growth. The ADP employment reports, which track private sector job growth, posted an increase of 219,000 jobs last month. That was well above expectations. The July Employment Situation, about to be released by the Bureau of Labor Statistics, is expected to show the economy added over 200,000 jobs.
Another confirmation of the good news came from employment expert research firm Challenger, Gray & Christmas. Job cuts in July fell to their lowest level in 20 months.
Challenger, Gray announced:
The pace of downsizing fell to the lowest level of the year in July, as U.S.-based employers announced plans to cut 27,122 workers from payrolls during the month, according to a report released Thursday
July’s total fell 27.1 percent from the 37,202 cuts announced in June and 4.2 percent from the same time last year, when 28,307 cuts were announced.
Last month’s total was the lowest of the year, falling below the previous low of 31,517 recorded in May. July’s cuts were the lowest since November 2016, when employers announced 26,936 cuts.
While it is good news, the trouble is that, at full employment, there is actually a labor shortage that has challenged some parts of the economy. John Challenger, chief executive officer of Challenger, Gray, said:
The economy is at near-full employment. Nearly 90 percent of companies recently polled by Challenger are either actively hiring or in retention mode. Companies are not letting go of their workforces right now.
That means some companies and industries have nowhere to turn to find them. It is hard to remember a time when this situation existed.
Economists wonder when the jobs boom will end. National unemployment is at 4% and may drop below that when the government issues its July numbers. Challenger, Gray’s figures only serve as another bit of good news and, ironically, a warning.