Despite the broader labor market showing more signs of deceleration, the health care sector remained robust in July, according to data released Friday by the Bureau of Labor Statistics.
In the previous month, health care and social assistance sectors added 73,300 jobs, representing the most significant growth among all groups during this period. Including private education within the health-care category, as some economists suggest, the growth figure would have reached 79,000 for the month.
July's nonfarm payrolls increased by 73,000, indicating that health care was responsible for nearly all these gains when accounting for job reductions in other areas. In other words, excluding the health-care sector, last month's employment report would have been negative overall.
“With health care and social assistance essentially driving the growth in private payrolls, while both the federal and local governments are shedding jobs—where local government previously contributed to June's participation—it suggests that ... a significant portion of the market is effectively stagnant,” Mark Hamrick, senior economic analyst at Bankrate, explained to CNBC. “It’s almost a no-hire, no-fire employment situation.”
June and May experienced significant downward revisions, with June's figures adjusted from 147,000 to an increase of just 14,000, and May's numbers reduced from 144,000 to only 19,000. These adjustments indicate a gradual decline in job growth over the past months. Nonetheless, certain areas are still experiencing growth.
The BLS highlighted that the upward trend in social assistance reflected “continued job growth in individual and family services,” which rose by approximately 21,000. Job growth in ambulatory health care services and hospitals also remained strong, increasing by 34,000 and 16,000, respectively.
Health care and social assistance's total growth surpassed retail trade by 57,600, with retail trade adding 15,700 jobs during the month.
Financial activities followed closely behind retail trade, with a gain of 15,000 jobs.
Conversely, more than half of the sectors posted declines in the monthly period. Out of the seven sectors that contracted, professional and business services led the decline with a reduction of 14,000 jobs.
The government sector, which had initially supported gains in June, lost 10,000 jobs in July.
Other notable sectors such as manufacturing and wholesale trade also experienced declines alongside government and professional and business services. Manufacturing saw a loss of 11,000 positions, while wholesale trade decreased by 7,800.
“This report certainly raises a red flag,” Hamrick noted. “We have another jobs report due before the mid-September [Federal Reserve] meeting, but it’s clear we’ll be scrutinizing both data and anecdotal evidence to determine whether this narrative of a slowing economy is becoming more consistent.”
