Jobs galore, but with a few cracks: report

SAN FRANCISCO - The nation got a very good report card on the already remarkably strong job market with better-than-expected results, many of which are better than before the pandemic. Except for nagging inflation, the U.S. economy is booming and the national jobs report proves it.

The U.S. job count increased by another 272,000 jobs last month, way more than the 180,000 that had been forecast and well above the running average of 232,000 a month. 

"At the same time, I think it's important to note: the main sectors of job growth nationwide continue to be one's connected to government spending," employment lawyer and former EDD Director Michael Bernick said.

Bernick cautions that healthcare, social services and direct government jobs account for 46% of the new jobs, much of it driven by tax money. 

"Private sector: construction, manufacturing, shows modest, far more modest gains," he said.

Nonetheless, the total national unemployment rate ticked up a notch to 4 percent. 

"Still low by the standards of the past half century, but above the 3.7% we had a year ago in 2023," Bernick said.

Wages compared to a year ago are 4.1 percent higher but stubborn inflation at 3.4 percent eats up most of that. 

"And I think that explains why polling shows most Americans dissatisfied or, at least very worried," he said.

The number of posted job listings has decreased to 8.1 million, but still above pre-pandemic numbers. 

"But. it's well below what we were two years ago in May of 2022 which was 11.7 million," he said.

The number of people voluntarily leaving their jobs, as opposed to layoffs or firings, is also down 3.5 million, well above pre-pandemic levels. 

"What we know about the quits rate is reflects a lot of confidence; confidence people have in the economy; the confidence they can get other jobs," said Bernick.

All of that seems hopeful and manageable. But here is what is not. 

"Declining spending, declining retail sales, declining industrial production as well as this stubbornly high inflation rate," he said.

All of those negatives suggest a future flattening in job growth that we've seen in the past.