August 2017 Unemployment Update

Continuing our ongoing coverage of the labor market, the August Employment Situation release from the Bureau of Labor Statistics provides even more evidence that the employment growth of the first half of the year has tapered off.  The headline U-3 unemployment rate rose by 0.1% back to June’s level, and the U-6 “underemployment” rate remained unchanged from July.

January July August 7-Month

Change

U-3 Unemployment Rate 4.8% 4.3% 4.4% -0.4%
U-6 Unemployment Rate 9.4% 8.6% 8.6% -0.8%
Civilian Noninstitutional Population* 254,082 255,151 255,357 +1,265
Civilian Labor Force 159,716 160,494 160,571 +855
Employed 152,081 153,513 153,439 +1,358
Unemployed 7,635 6,981 7,132 -503
Employment-Population Ratio 59.9% 60.2% 60.1% +0.2%
Part-time for Economic Reasons 5,840 5,282 5,255 -585
Marginally Attached to Workforce 1,752 1,629 1,548 -204
  • Discouraged Workers
532 536 448 -84
* All numbers are in thousands

The repeated oscillations in the discouraged worker numbers over the last several months suggests that there’s no real trend at the moment.  It’s entirely possible that the dislocations due to Hurricane Harvey will cause at least a temporary spike in unemployment over the next few months.  The recovery and repair efforts will presumably cancel that out over time, though research into the employment effects of Hurricane Katrina suggests that any widespread permanent evacuations (necessitated by destroyed communities and infrastructure) could negatively impact employment for the affected populations for some time to come.  Effective policies for returning evacuated communities to their homes will make the difference, so hopefully the rebuilding effort will avoid the endemic dysfunction of the Trump administration.

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