WASHINGTON — The Coalition for a Prosperous America (CPA) today announced that the U.S. Private Sector Job Quality Index (JQI) was 82.45, essentially flat with only a change of -0.03% from the preceding month. The overall June 2024 Jobs Report from the government’s Bureau of Labor Statistics also showed mediocre results. Employment was up 206,000 jobs (slightly higher than expectations), but employment gains in April and May were revised down by 111,000.
The April Jobs Report also showed a slight rise in the unemployment rate to 4.1%, reflecting a gradual rise in people unable to find work this year. The January unemployment rate was 3.7%. Furthermore, only 136,000 jobs within June’s employment gains were from the private sector. The other 70,000 were from public sector employment gains. The private sector payroll growth was below expectations, gaining 136,000 compared to the 160,000 private job growth forecast.
The mediocre jobs report and flat JQI may be signs of cooling in the economy as high interest rates bite into spending and the 2024 presidential election approaches. The overall employment growth report did beat expectations slightly, but rising unemployment, downward job revisions for previous months, and weak private-sector job growth are worrying signs for the economy.
The JQI, developed by CPA in partnership with other economists, divides the U.S. private sector nonmanagement labor force of 109.6 million employees into 16 sectors and 164 subsectors to evaluate economic trends in national employment. Sectors where the average weekly wage is above the average weekly wage for this group are termed “high-quality jobs” and those below are “low-quality jobs.” The data shows that for over 30 years the U.S. economy has created more low-quality jobs than high-quality.
In addition to the slight decrease in the JQI, the report also shows flat growth for high-quality jobs. From April to May 2024, high-quality job employment was slightly down by an average of 0.05%. The high-quality job categories with the highest losses are Specialized design services (down 3.17%), Logging (down 2.84%), and Support activities for mining (down 2.53%). Meanwhile, the fastest growing high-quality job categories, Independent artists, writers, and performers, as well as Oil and gas extraction, only increased by 1.69% and 1.28% respectively. The fastest-growing job categories are both low-quality job categories. These include Apparel manufacturing (up 3.13%) and Motion picture & sound recording industries (up 2.53%).
Total manufacturing employment fell in June, by 8,000 jobs to 12.950 million, according to today’s BLS report. Manufacturing employment is up by just 5,000 jobs compared to a year ago. Furthermore, low-quality manufacturing job categories accounted for most of the manufacturing employment gains in the JQI report. These categories include Apparel manufacturing (up 3.13%), Textile mill manufacturing (up 1.84%), and Textile product mill manufacturing (up 1.17%). Chemical manufacturing performed the best among high-quality manufacturing jobs, gaining 1.12% employment, and Paper manufacturing (losing 1.22%) experienced the most losses among high-quality manufacturing jobs.
Both high-quality and low-quality jobs saw increases in weekly income. High-quality jobs saw a 0.67% increase, and low-quality jobs saw a 0.33% increase. The biggest contributors to the high-quality job weekly income growth were Hospitals (up 1.65%), Agencies, brokerages, and other insurance-related activities (up 1.42%), and Automobile dealers (up 1.37%). Among low-quality jobs, Employment services (up 1.63%) and Amusement, gambling, and recreation industries (up 1.56%) were the largest contributors to the weekly income gains.
For high-quality manufacturing jobs, overall weekly income growth rose 1.64%. Primary metal manufacturing and Chemical manufacturing experienced the strongest weekly income growth at 4.93% and 2.58% respectively. Meanwhile, high-quality manufacturing job income losses were relatively small. Only Nonmetallic mineral product manufacturing saw losses in weekly income (down 0.49%).
Conversely, low-quality manufacturing jobs experienced an overall decline in weekly income of 0.76%. This can mostly be attributed to income losses for Apparel manufacturing (down 3.47%) and Furniture and related product manufacturing (down 2.30%).
Figure 1. Job Quality Index 1990-2024
