Here’s Where the Labor Market is Heading

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Source: Mark Ralston/Getty Images

Source: Mark Ralston/Getty Images

“Steady as she goes in the job market,” reported Moody’s Analytics economist Mark Zandi Thursday morning. And there is plenty of data to support that assessment. Data from Gallup shows that Americans’ satisfaction with job security has returned to high pre-recession levels; both unemployment and employment levels remain stable; and the percentage of Americans reporting their employers are hiring and expanding their workforces has held constant at a six-year high for several months.

The monthly National Employment Report compiled by payroll processor ADP and Moody’s Analytics calculated that private sector employment increased in August by 204,000 jobs, growth consistent with a healthy labor market. Economists consider the addition of 200,000 jobs a key labor market benchmark. Furthermore, outplacement consultancy firm Challenger, Gray & Christmas data revealed that planned layoffs continued to decline last month while emerging unemployment remains well within normal bounds. But the lesson of the more than five-year long recovery remains true: Headline numbers often tell a more positive story than the narrative told by the complete range of labor market and economic data.

Wage stagnation, mediocre but stable economic confidence, improving views on job security, stronger job creation numbers, low layoffs, and the return of emerging unemployment to pre-recession levels weave together the backstory for the Department of Labor’s key August Employment Situation Report, which will be released Friday.

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