Americans Are Coming Back to the Labor Force

But Teachers Still Aren’t Coming Back to School

The labor market remained remarkably resilient in August, with broad gains. Payrolls swelled by 315k in August—about twice the 2019 monthly average gain (164k). A modest slowdown in job growth was to be expected, now that employment has recovered to pre-pandemic levels. It is also welcome news for the Fed, which is aggressively fighting inflation and believes that success will require considerable softening in the labor market. 

The best news in this jobs report is that the unemployment rate went up. It did so for all the right reasons: people are coming back to the labor force. And so despite stiff headwinds—inflation, rising interest rates, a strong dollar—employers are finding it a little bit easier to hire. 

That’s not the case across the board, however. While children have started going back to school, teachers, it appears, have not. Staff headcount in local government education fell, and is 362.9k below the pre-pandemic level. Public schools are battling a chronic shortage of teachers and school support staff–a problem ZipRecruiter is committed to help solving through an innovative public-private partnership launched this week at the White House. 

Here are some highlights of the report: 

  • The labor force participation rate went up by 0.3 percentage points and the number of people not in the labor force who currently want a job declined by 361k, and labor force went up by 786k—a sign that people who have been on the sidelines of the labor market are now jumping back in. In recent ZipRecruiter surveys, job seekers have cited inflation as a major reason they have started looking for a job. 
  • Another industry achieved the milestone of a full return to pre-pandemic employment levels: wholesale trade. Employment in the industry increased by 15k in August, returning to its February 2020 level. The industry has added 197k net new jobs over the year.
  • After several months in which the establishment survey was at odds with the household survey, the two are finally more aligned after a blockbuster month in the household survey. With the employment level in the household survey growing by 442k and the labor force growing by 786k, both surveys now point to a robust, resilient growth. 
  • Leading indicators in the jobs report point to continued growth in the coming months. For example, temporary help services added 11.2k new jobs in August. Temporary help service employment generally falls ahead of an economic downturn, but it is not yet signaling a recession. 

Written by

Julia Pollak is Chief Economist at ZipRecruiter. She leads ZipRecruiter's economic research team, which provides insights and analysis on current labor market trends and the future of work.

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