July Jobs Report Summary: Which Industries Hired the Most Workers?

Huntington Private Bank chief economist Olu Omodunbi says the employment report points to a slowdown in the labor market on “The Claman Countdown.”

Job growth slowed in July as many industries such as manufacturing, retail and trade halted hiring.

Employers added 114,000 jobs in JulyThe Labor Department said in its monthly payroll report released Friday that there was a shortage 175,000 in profits forecast by LSEG economists. Meanwhile, the unemployment rate rose slightly to 4.3%, its highest level since October 2021.

“Yellow flags have been showing up in labor market data over the past few months, but now the flags are turning red,” said Nick Bunker, director of North American economic research at Indeed Hiring Lab. “The rise in the unemployment rate cannot be ignored as job growth has weakened and become less broad-based.”

The health care sector accounted for the largest payroll gains in July, adding 55,000 jobs. Employment continued to grow in home care services (21,600), hospitals (19,500) and nursing and assisted living facilities (9,200).

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The construction sector also saw modest gains last month, with the number of workers increasing by 25,000. The majority of these jobs were created in specialist construction firms (18,700).

Employment in the leisure and hospitality sector was the third-largest contributor to job growth last month. The industry added 23,000 workers in July. Almost all of the gains — about 19,500 — came in bars and restaurants. Hotels added more than 6,000 workers in July.

However, employment outside these sectors was poor,

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Elementary school teachers meet to talk to potential employees during a recruiting event for the Prince George’s County School District held at Dr. Henry A. Wise Jr. High School in Upper Marlboro, Maryland, August 2, 2023. ((Amanda Andrade-Rhoades/For The Washington Post via Getty Images)/Getty Images)

“The payroll survey at least shows employment growth, but growth is clearly slowing,” Bunker said. “Employment growth is also slowing as the diffusion index fell below 50 in July, indicating that fewer than half of industries added jobs during the month. Health care and social assistance may continue to add a healthy number of jobs, but one sector alone cannot sustain the expansion.”

Other increases last month included employment in government administration (17,000), transportation and warehousing (14,000) and social assistance (9,000).

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Employment declined in several sectors of the economy last month.

Employment in the information technology sector fell by 20,000, while financial services lost 4,000 jobs. Mining and logging, and professional and business services each lost 1,000 jobs.