Veteran Employment Situation Report – August 2016

Veteran Employment Situation Report
Issue 16-09
Friday, September 2, 2016
www.vetjobs.com

Welcome to the September 2016 VetJobs Veteran Employment Situation Report (VESR) covering veteran unemployment for AUGUST 2016. The VESR is published on the Friday of the month when the Department of Labor (DOL) releases the unemployment reports which is generally the first Friday of the month.

This report is in three parts.

-The first section will be an editorial providing a brief overview of the economy and the Department of Labor’s (DOL) Bureau of Labor Statistics (BLS) report on the labor market.

-The second covers where the jobs were created and where one would currently have the best chance for finding employment.

-The third covers specifically the employment situation of veterans.

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EMPLOYMENT SUMMARY

Editorial Overview

The unemployment report released by the Bureau of Labor Statistics this morning reports that only 151,000 new jobs were created in August and the national unemployment rate remained steady at 4.9%. This report is next to the last before the election and will definitely have political overtones. Politicians will try to spin it to their advantage, but they cannot argue with the numbers.

This is a disappointing report as given the size of the American workforce, the country needs to be creating at least 200,000 plus new jobs to have any real economic growth. After two months of job growth with July having seen 255,000 new jobs, August saw job stagnation. The economy is going back into a malaise.

The good news is that the overall veteran unemployment rate fell from 4.7% to 4.3%. This again affirms that in spite of the slow recovery in the economy, veterans are finding employment at a better rate than non-veterans!

In reviewing where the new jobs were created, healthcare is still growing but at a slower rate. Mining employment continues to fall which is a bad sign. Mining is a deep forward leading indicator for jobs and manufacturing. When mining falls, it is an indication the economy is going south.

Disappointingly the labor force participation rate remained at 62.8%, the lowest in 40 years. This is disturbing because it means 37.2% of eligible workers are not participating in the labor force. You cannot have a vibrant or growing economy when nearly 40% of your workforce is not working. They are needed for productivity, taxes, creativity, etc. Additionally, the 37.2% become a drag on the economy as someone has to pay for their housing, food, healthcare and transportation. That someone is generally the tax payers who are working.

On the economic front, the Commerce Department this past Friday released their numbers and the economy actually did slightly WORSE than originally estimated. Growth was 1.1% in the second quarter of this year and less than 1.0% for the first six months of 2016. Historically, the American economy has grown at 2.0% or greater per year. That stopped in the last eight years. The business sector of the economy is slowly sinking into recession territory, something one would not realize listening to the political pundits and candidates. Corporate profits shrunk 2.4% per the Commerce Department.

What has kept the economy out of negative territory is the consumer, but that’s only because consumers are spending more than they are earning. Consumer spending was up 4.0%, but incomes were only up 2.0%. Debt is again becoming a problem for many.

For years the polls have shown that Americans are hyper-concerned about the economy and job security. That was when the economy was growing at 2.0%. Now with the economy at only 1.0% growth, the United States isn’t just treading water, more families are being plunged underwater.

The slow recovery from the 2008 financial crisis is beyond anemic. Some of our political candidates and administration officials who keep saying how well the economy is doing seem to be living in an alternative universe. That is probably because so many of the pundits and economists live and work in Washington DC, which really is doing just fine due to federal dollars. Three of the five wealthiest counties in America are around DC. That should tell you a lot.

Another economic problem is the deficit. The Commerce Department says the deficit is now climbing again and is estimated at $600 billion this year. The red ink is headed back to $1 trillion on current course. Some states are facing 20% or more rise in Obamacare premiums this year and many health insurers are dropping out of Obamacare all together. The United States is now over $19 trillion in debt, with nearly half being racked up in the last eight years. This is a huge burden on both the economy and future generations of tax paying Americans.

We need to get our politicians to understand that a 1.0% growth economy must not become the new normal. Our country needs a new economic policy.

Thank you for reading.

Ted Daywalt
President

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From the BLS

Erica L. Groshen, Commissioner of the Bureau of Labor Statistics reported this morning that nonfarm payroll employment increased by 151,000 in August, and the unemployment rate remained at 4.9%. Employment continued to trend up in several service-providing industries.

Incorporating revisions for June and July, which reduced nonfarm payroll employment by 1,000 on net, monthly job gains have averaged 232,000 over the past 3 months. In the 12 months prior to August, employment growth averaged 204,000 per month.

Average hourly earnings of all employees on private nonfarm payrolls were up by 3 cents in August to $25.73. Over the past 12 months, average hourly earnings have risen by 2.4%. From July 2015 to July 2016, the Consumer Price Index for All Urban Consumers (CPI-U) increased by 0.9% (on a seasonally adjusted basis).

In August, most major labor market measures from the survey of households continued to show little or no change. The unemployment rate was 4.9% for the third consecutive month and has shown little net movement during the past year. There were 7.8 million unemployed persons in August, about the
same as a year earlier. In August, 2.0 million unemployed persons had been searching for work for 27 weeks or more; these long-term unemployed accounted for 26.1% of the unemployed, little changed from a year earlier.

Both the labor force participation rate, at 62.8%, and the employment-population ratio, at 59.7%, were unchanged over the month. Among the employed, 6.1 million worked part time for economic reasons in August, little changed from July. (These involuntary part-time workers would prefer to work
full time, but had their hours cut or were unable to find full-time jobs.)

Among people who were neither working nor looking for work in August, 1.7 million were marginally attached to the labor force, about the same as a year earlier. Discouraged workers, a subset of the marginally attached who believed that no jobs were available for them, numbered 576,000 in August, also about the same as a year earlier. (Marginally attached to the labor force refers to those who had not looked for work in the 4 weeks prior to the survey but wanted a job, were available for work, and had looked for a job within the last 12 months.)

In summary, nonfarm payroll employment increased by 151,000 in August, and the unemployment rate remained at 4.9%. Veteran overall unemployment fell from 4.7% to 4.3%.

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WHERE THE NEW JOBS WERE CREATED

For those people looking for work, the following paragraphs from the BLS commissioner’s report indicates where the new jobs were created. If you are looking for a job, these areas may offer employment opportunities.

Employment in food services and drinking places continued to trend up in August (+34,000). Over the year, the industry has added 312,000 jobs.

The social assistance industry added 22,000 jobs in August, mostly in individual and family services (+17,000).

Employment in professional and technical services edged up by 20,000 in August, roughly in line with the average monthly gain over the prior 12 months (+24,000).

Employment in financial activities continued on an upward trend in August (+15,000), with a gain of 6,000 in securities, commodity contracts, and investments. The financial activities sector has added 167,000 jobs over the year.

Health care employment continued to trend up over the month (+14,000), but at a pace well below the average monthly gain over the prior 12 months (+39,000). In August, hospitals added 11,000 jobs, and employment in ambulatory health care services trended up (+13,000). A job loss in nursing and residential care facilities (-9,000) offset a gain in July.

Mining employment continued on a downward trend in August (-4,000). Although job losses have moderated in the last 3 months, employment in mining has fallen by 223,000 since a peak in September 2014.

Employment changed little over the month in several other industries, including construction, manufacturing, wholesale trade, retail trade, transportation and warehousing, temporary help services, and government.

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VETERAN UNEMPLOYMENT REPORT

General Summary from CPS Veterans Report

The BLS CPS report states there were 20,857,000 veterans left in the United States in August, down 26,000 from the 20,883,000 veterans in July. As I have said many times, since the Vietnam War the trend of veterans in the United States has continuously been decreasing. America has lost two-thirds of its veterans since the Vietnam War. This is an important issue for veterans as with decreasing numbers, they are losing the political power they had in the past.

BLS CPS reports there were 10,522,000 (50.4%) veterans in the workforce in August. That represents a decrease of 99,000 from the 10,262,000 (50.9%) veterans in the workforce in July.

453,000 (4.3%) veterans were unemployed in August, up 4,000 from the 449,000 (4.7%) veterans who were unemployed in July. 10,335,000 veterans were not in the workforce in August, an inecrease from the 10,262,000 who were not in the workforce in July. This number shows there are a lot of veterans sitting on the sidelines and not participating in the workforce. This is also true of civilians where 90 million are not participating in the workforce. In spite of what politicians may say, you cannot have a thriving economy with so many people not participating in the workforce.

The really good news is the overall veteran unemployment rate continues to be lower than the national unemployment rate. The fact that the veteran unemployment rate of 4.3% is lower than the national unemployment rate of 4.9% is great news for the veteran community. And again demonstrates that veterans are in high demand in the civilian work place. The August 4.3% veteran unemployment rate again confirms that veterans are obtaining employment at a better rate than nonveterans.

Younger Veterans

In August there were 225,000 veterans in the 18 to 24-year old cohort, down from 234,000 in July. Of those, 156,000 (69.3%) were in the civilian labor force, of which 146,000 (64.8%) were employed and 10,000 (6.5%) were unemployed. For comparison, the national 18 to 24-year old unemployment rate in August was 9.3% (1,832,000).

There were 1,748,000 veterans in the 25 to 34-year old veteran cohort in August, up 5,000 from July. Of this group, 1,423,000 (81.4%) were in the workforce of which 1,330,000 (76.1%) were employed and 94,000 (6.6%) were unemployed. 325,000 were not in the workforce. For comparison, the national unemployment rate for the 25 to 34 year olds in August was 5.3% (1,881,000)

Older Veterans

The unemployment rates for the older veteran cohorts are as follows:

August July June
35 to 44 year olds 4.2% (83,000) 5.6% (110,000) 4.1% (80,000)
45 to 54 year olds 4.0% (113,000) 3.1% (85,000) 3.0% (81,000)
55 to 64 year olds 3.6% (83,000) 4.7% (111,000) 4.0% (91,000)
65 year olds and over 3.7% (71,000) 4.0% (76,000) 4.5% (88,000)

The above numbers indicate that older veterans in August and for the last three months found jobs at a better rate than non-veterans given that the national unemployment rate is 4.9%. Most economists view unemployment rates of below 4.5% to 5.0% as just the normal churn of people moving between jobs. Some refer to it as natural unemployment. No matter what one calls it, the overall numbers for veteran unemployment are very strong when compared to their civilian counterparts!

Women Veterans

There were 2,015,000 women veterans in August. 1,248,000 (61.9%) were in the civilian labor force of which 1,160,000 (57.6%) were employed, and 87,000 (7.0%) were unemployed. 767,000 women veterans were not in the workforce in August The national unemployment rate for women in August was 5.1% (3,755,000).

Gulf War II Veterans

There were 3,846,000 Gulf War II era veterans in August. 3,154,000 (82.0%) were in the workforce. Of those, 3,007,000 (78.2%) were employed and 147,000 (4.7%) were unemployed. 692,000 Gulf War II era veterans were not in the labor force.

Black Veterans

There were 2,508,000 black veterans in August, of which 1,441,000 (57.5%) were in the civilian work force. 1,330,000 (53.0%) were employed and 111,000 (7.7%) were unemployed. The national Black unemployment rate in August was 8.1% (1,594,000). The national Black unemployment rate is higher than the Black veteran unemployment rate. These numbers again confirm the advantages of minorities joining the military to obtain employment skills and work experience. From these numbers, the Black veterans are definitely finding jobs at a better rate than their Black civilian counterparts!

Asian Veterans

There were 310,000 Asian veterans in August of which 220,000 (70.9%) were in the workforce. 215,000 (69.3) were employed and 5,000 (2.3%) were unemployed. 90,000 were not in the labor force. The national Asian unemployment rate in August was 4.0% (387,000).

Hispanic Veterans

There were 1,408,000 Hispanic veterans in August of which 837,000 (59.5%) were in the workforce. 786,000 (55.8%) were employed and 51,000 (6.1%) were unemployed. 571,000 were not in the workforce. The national unemployment rate for Hispanics in August was 5.5% (1,451,000).

White Veterans

There were 17,452,000 White veterans in August of which 8,510,000 (48.8%) were in the workforce. 8,181,000 (46.9%) were employed and 329,000 (3.9%) were unemployed. 8,942,000 White veterans were not in the workforce. The national White unemployment rate in August was 4.3% (5,253,000).

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Thank you for reading the VetJobs Veteran Employment Situation Report (VESR). If you have any questions, please contact Ted Daywalt at info@vetjobs.com or call 877-838-5627 (877-Vet-Jobs).
Should you know of others who may want this information, they can sign up for the report by sending an email request to contact@vetjobs.com. If you want to be removed, use the same email.

Ted Daywalt
President

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