September 2024 Market Trends Report
“Weaker than expected” is a familiar refrain for labor market trends this quarter and is repeated yet again to describe the August report.
With 142,000 employees on payrolls added and prior months revised down, the labor market has notably downshifted in a continuing trend.
According to the Bureau of Labor Statistics’ Employment Situation Summary, payroll growth was stronger than July’s dismal report (with June and July revised down by a combined 89,000 payrolls), yet it fell short of Wall Street’s forecast by 19,000 payrolls.
While the unemployment rate decreased slightly (from 4.3% to 4.2%), some economists believe the overall unemployment trajectory is headed upward and that the revision to June and July’s data is concerning.
Indeed Hiring Lab reported, “The three-month average of job gains at 116,000 per month, lower than the pace needed to simply tread water and below 2019’s average clip.”
While U.S. Bank Chief U.S. Economist Beth Ann Bovino stated, “There’s not reason to panic” in an interview with The Washington Post, it seems the labor market could be on shaky ground.
The economy is sending mixed signals to employers, and job seekers consistently report they’re having a difficult time finding work.
Jobs Market Overview: August 2024
4.2%
Overall unemployment rate
The slight decrease in unemployment halted the four-month trend of increasing rates, dipping slightly from 4.3%.
142k
Jobs added
August brought weak (yet increasing) job gains month over month, and the BLS revised the three-month average to 116,000 payrolls per month.
62.7%
Labor force participation rate
Labor force participation held its 62.7% rate.
Industry Employment Trends
OVERALL ECONOMY
+142k
Monthly job change
(+1.5% YOY Difference)
| Industry | Monthly Job Change | YoY Difference |
| Manufacturing | -24k | -0.1% |
| Automotive | -5.9k | +3.4% |
| Warehousing & Storage | +3.9k | -0.3% |
| Architectural & Engineering | +0.8k | +2.5% |
| Construction | +34k | +2.8% |
Source: Bureau of Labor Statistics' Economic News Release
Sector by Sector News: August 2024
Manufacturing Jobs Report
August Manufacturing PMI: 47.2%*
August Employment Index: 46%
Economic activity in the manufacturing industry contracted for the fifth consecutive month in August (yet is up 0.4% from July), according to the Institute for Supply Management (ISM).
Hiring within the industry reflects this contraction, which lost 24,000 employees. Registering 46% on ISM’s Employment Index, August’s report shows an accelerating trend of slowing job growth throughout the year.
Of the past 11 months, 10 have seen a contraction, according to ISM: “The July and August readings are among the four lowest recorded since … July 2020 … Respondents’ companies are continuing to reduce head counts through layoffs, attrition and hiring freezes.”
Respondents to the ISM survey also report noticeable slowdowns in business activity, including diminishing orders and backlogs, which will likely continue until after the election.
Warehousing & Storage Jobs Report
August Logistics Manager’s Index (LMI): 56.4*
*A LMI above 50 indicates that logistics metrics are expanding.
The August Logistics Manager’s Index (LMI) reported expansion for the ninth consecutive month, deviating slightly downward from July (-0.1) and remaining consistent in its slow and steady growth.
Job gains were modest yet show resiliency in the industry, with 3,900 jobs added in August and an upward revision by BLS of 56,400 payrolls for 2024.
CEO of Warehousing and Fulfillment Will Schneider reported, “This stands in stark contrast to the previous year, when the sector saw a downward revision of 146,400 jobs, reflecting a 2.2% decline. This upward revision is particularly notable given that virtually every other sector posted job declines, reducing more than 800,000 jobs overall.”
According to LMI:
Growth is increasing at an increasing rate for:
- Inventory levels
- Inventory costs
- Warehousing capacity
- Warehousing prices
- Transportation capacity
- Transportation utilization
- Warehousing utilization
- Transportation prices