![](\"https:\/\/static01.nytimes.com\/newsgraphics\/aug23-jobs\/8212f104-ca20-41bc-a2b0-bdd163a49d33\/_assets\/change-in-jobs-335.png\")
<\/p>\nMonthly change in jobs<\/p>\n
<\/p>\n
+400,000 jobs<\/p>\n
+187,000 jobs<\/p>\n
in August<\/p>\n
+300,000<\/p>\n
+200,000<\/p>\n
+100,000<\/p>\n
Aug.<\/p>\n
’22<\/p>\n
Nov.<\/p>\n
Feb.<\/p>\n
’23<\/p>\n
May<\/p>\n
Aug.<\/p>\n
![](\"https:\/\/static01.nytimes.com\/newsgraphics\/aug23-jobs\/8212f104-ca20-41bc-a2b0-bdd163a49d33\/_assets\/change-in-jobs-600.png\")
<\/p>\n
+400,000 jobs<\/p>\n
+187,000<\/p>\n
jobs in August<\/p>\n
+300,000<\/p>\n
+200,000<\/p>\n
+100,000<\/p>\n
Aug. ’22<\/p>\n
Nov.<\/p>\n
Feb. ’23<\/p>\n
May<\/p>\n
Aug.<\/p>\n
Note: Data is seasonally adjusted.<\/p>\n
Source: Bureau of Labor Statistics<\/p>\n
By Ella Koeze<\/p>\n
The United States labor market is starting to look a lot like its old self \u2014 the one that existed before the pandemic.<\/p>\n
The Federal Reserve\u2019s interest rate increases have chilled investment, high-flying industries have returned to earth, and workers are staying put in their jobs rather than jumping for higher pay.<\/p>\n
Employers added 187,000 jobs in August, the Labor Department reported Friday, and the previous two months\u2019 figures were revised downward. That brings the three-month average to 150,000 \u2014 a marked slowdown from the 200,000 achieved for 29 consecutive months before that, and slightly lower than the average pace of 163,000 in 2019.<\/p>\n
The question is whether that cooling will continue to levels that feel more like a real freeze as borrowing costs remain high and pressures on consumer spending mount.<\/p>\n
\u201cI think the labor force is finally healing to the point where we\u2019re seeing some pre-Covid numbers,\u201d said Chris Chmura, chief executive of Chmura Economics & Analytics. \u201cBut taking a step back and looking at broader trends in the economy, we\u2019re not ruling out the potential of a recession next year.\u201d<\/p>\n
Hoping to contain price growth without causing a painful recession, the Federal Reserve has been looking for assurance that the labor market is loosening enough to reduce the risk that excessive demand for goods and services might cause inflation troubles to reignite.<\/p>\n
Unemployment rate<\/p>\n
![](\"https:\/\/static01.nytimes.com\/newsgraphics\/aug23-jobs\/8212f104-ca20-41bc-a2b0-bdd163a49d33\/_assets\/unemployment-335.png\")
<\/p>\n
15%<\/p>\n
10<\/p>\n
5<\/p>\n
3.8%<\/p>\n
2019<\/p>\n
2020<\/p>\n
2021<\/p>\n
2022<\/p>\n
2023<\/p>\n
![](\"https:\/\/static01.nytimes.com\/newsgraphics\/aug23-jobs\/8212f104-ca20-41bc-a2b0-bdd163a49d33\/_assets\/unemployment-600.png\")
<\/p>\n
15%<\/p>\n
10<\/p>\n
5<\/p>\n
3.8%<\/p>\n
2019<\/p>\n
2020<\/p>\n
2021<\/p>\n
2022<\/p>\n
2023<\/p>\n
Note: Data is seasonally adjusted.<\/p>\n
Source: Bureau of Labor Statistics<\/p>\n
By Ella Koeze<\/p>\n
A jump in the unemployment rate, to 3.8 percent in August from 3.5 percent, provides some of that evidence. The difference came from an increase of 736,000 people who are working or looking for work, raising the overall labor force participation rate to 62.8 percent, within a half a percentage point of its prepandemic high.<\/p>\n
A slightly softer-than-expected increase in wages adds to that picture, with hourly earnings rising 4.3 percent from a year earlier, mostly level with the pace of wage growth since the spring. The August report reinforced market expectations that the Fed will hold interest rates steady at its next meeting, in mid-September, as it waits to assess the impact of the five-percentage-point increase over the past year and a half.<\/p>\n
Year-over-year percentage change in earnings vs. inflation<\/p>\n
![](\"https:\/\/static01.nytimes.com\/newsgraphics\/aug23-jobs\/8212f104-ca20-41bc-a2b0-bdd163a49d33\/_assets\/wages-335.png\")
<\/p>\n
+8%<\/p>\n
+6<\/p>\n
AVG. HOURLY<\/p>\n
EARNINGS<\/p>\n
+4.3%<\/p>\n
in August<\/p>\n
+4<\/p>\n
CONSUMER<\/p>\n
PRICE INDEX<\/p>\n
+3.2%<\/p>\n
in July<\/p>\n
+2<\/p>\n
2019<\/p>\n
2020<\/p>\n
2021<\/p>\n
2022<\/p>\n
2023<\/p>\n
![](\"https:\/\/static01.nytimes.com\/newsgraphics\/aug23-jobs\/8212f104-ca20-41bc-a2b0-bdd163a49d33\/_assets\/wages-600.png\")
<\/p>\n
+8%<\/p>\n
+6<\/p>\n
AVG. HOURLY<\/p>\n
EARNINGS<\/p>\n
+4.3%<\/p>\n
in August<\/p>\n
+4<\/p>\n
CONSUMER<\/p>\n
PRICE INDEX<\/p>\n
+3.2%<\/p>\n
in July<\/p>\n
+2<\/p>\n
2019<\/p>\n
2020<\/p>\n
2021<\/p>\n
2022<\/p>\n
2023<\/p>\n
Note: Earnings data is seasonally adjusted.<\/p>\n
Source: Bureau of Labor Statistics<\/p>\n
By Ella Koeze<\/p>\n
The recent hiring figures are subject to further revision; the Bureau of Labor Statistics has already indicated that job growth will look slightly weaker when it completes its annual benchmarking process.<\/p>\n
But the overall trajectory is a sign that although the labor market is not as hot as it was during the height of the pandemic recovery, it may be leveling out in a better form than it took before 2020.<\/p>\n
\u201cThe good news is, it\u2019s a normal that favors workers more than we\u2019re used to over the past 25 years,\u201d said Justin Bloesch, an assistant professor of economics at Cornell University. Moreover, he noted, stability has its own benefits: People are more likely to join the work force if they feel confident they will be able to stay there awhile.<\/p>\n
\u201cThis is where we start to get to the time where the duration of a good labor market matters more than how good,\u201d Dr. Bloesch said.<\/p>\n
Much of the slowdown has come from industries that are returning to more typical levels after the pandemic\u2019s upheaval. Exhibit A: truck transportation, which grew to serve a stay-at-home online shopping spree and shrank as it died down. Trucking company payrolls flattened out over the past year, which probably masks an outright decline because many contracted owner-operators have also parked their rigs.<\/p>\n
Last month, the industry subtracted nearly 37,000 jobs all at once with the bankruptcy of Yellow, which employed about 30,000 drivers and other staff members. If the mid-August jump in initial claims for unemployment insurance are any indication, most of those drivers did not immediately find new jobs.<\/p>\n
\u201cThe truck job market has gone from excruciatingly tight in 2021 and the first half of 2022 to being as loose as it\u2019s been since sometime shortly after the Great Recession,\u201d said Kenny Vieth, president and senior analyst at ACT Research. \u201cWith Yellow taking 20-plus-thousand drivers out of the market, it\u2019s a start in getting supply under control.\u201d<\/p>\n
It\u2019s not just the trucking industry, however. The rest of the labor market is also coming into balance, with the number of job openings per unemployed worker declining to about 1.5 in July from more than two in early 2022, indicating that employers\u2019 appetite for labor is nearly sated. Over the past year, the temporary help services industry has lost 185,000 jobs as employers have less need for extra short-term labor and can rely on their regular employees. The average number of hours worked per week has also receded, with overtime becoming less essential as payrolls have filled out.<\/p>\n
That squares with what Kevin Vaughan has been seeing at his collection of six bars and restaurants in Chicago. It\u2019s been a very busy summer, and over the past year, he\u2019s had to fight to keep cooks and servers. Lately, though, he\u2019s seen more qualified job applicants who need work because their starting dates at law firms have been deferred. He worries that the resumption of student loan payments may cause his customers to cut back on nights out with friends, but it helps him maintain consistent staffing.<\/p>\n
\u201cNow we\u2019re becoming much more cost-focused,\u201d Mr. Vaughan said. \u201cAnd those who are already on our payroll are becoming much more focused on, \u2018I need to make money, I got expenses, I need to show up to work.\u2019\u201d<\/p>\n
Change in jobs in August 2023, by sector<\/p>\n
![](\"https:\/\/static01.nytimes.com\/newsgraphics\/aug23-jobs\/8212f104-ca20-41bc-a2b0-bdd163a49d33\/_assets\/sectors-335.png\")
<\/p>\n
+102,000 jobs<\/p>\n
Education and health<\/p>\n
Leisure and <\/p>\n
hospitality<\/p>\n
+40,000<\/p>\n
+22,000<\/p>\n
Construction<\/p>\n
Business <\/p>\n
services<\/p>\n
+19,000<\/p>\n
+16,000<\/p>\n
Manufacturing<\/p>\n
+8,000<\/p>\n
Government<\/p>\n
+6,300<\/p>\n
Retail<\/p>\n
![](\"https:\/\/static01.nytimes.com\/newsgraphics\/aug23-jobs\/8212f104-ca20-41bc-a2b0-bdd163a49d33\/_assets\/sectors-600.png\")
<\/p>\n
+102,000 jobs<\/p>\n
Education and health<\/p>\n
+40,000<\/p>\n
Leisure and hospitality<\/p>\n
+22,000<\/p>\n
Construction<\/p>\n
Business services<\/p>\n
+19,000<\/p>\n
+16,000<\/p>\n
Manufacturing<\/p>\n
+8,000<\/p>\n
Government<\/p>\n
+6,300<\/p>\n
Retail<\/p>\n
Note: Data is seasonally adjusted.<\/p>\n
Source: Bureau of Labor Statistics<\/p>\n
By Ella Koeze<\/p>\n
With hiring frenzies abating, employment growth has narrowed to a few industries that are still in recovery, like leisure and hospitality, or are set up for sustained demand because of structural factors in the economy, like private health care and education services. Those two broad sectors have accounted for 85 percent of the job gains over the past three months. Both are also disproportionately supplied by immigrants and women, groups that have entered the labor force at rates that surprised many analysts.<\/p>\n
\u201cAt some point, and you\u2019re seeing that somewhat on the leisure and hospitality side, those legs run out,\u201d said Stephen Juneau, an economist with Bank of America Merrill Lynch. \u201cHealth services are structurally supported by aging demographics, and we\u2019re just getting hospital funding back to normal. Once those support legs come off, what are we left with?\u201d<\/p>\n
One possible answer is renewed energy on the goods-providing side of the economy. Construction has remained surprisingly resilient. Home building has buckled under the strain of rising interest rates, and high vacancy rates have stalled office construction, but public infrastructure funding and tax breaks for renewable energy installations and semiconductor plants are creating more demand on the horizon.<\/p>\n
Demand for cement is a leading indicator of jobs in construction, and it\u2019s expected to decline by 2 percent this year, after a 13-year growth streak. But Ed Sullivan, chief economist for the Portland Cement Association, sees a turnaround next year fueled by federal spending on roads, bridges and other infrastructure.<\/p>\n
\u201cWe haven\u2019t really seen a heck of a lot of demand yet, but it\u2019s starting to emerge,\u201d Mr. Sullivan said. So far, a long backlog in orders has prevented significant layoffs. \u201cIt\u2019s not having a significant adverse impact on employment, because we still need the drivers, we still need the contractors, et cetera,\u201d he said.<\/p>\n
Much of that construction spending is on new factories, which indicates that manufacturing employment \u2014 which has been flat in 2023 \u2014 may pick up next.<\/p>\n