There’s a big weather-related asterisk behind the weak US jobs data
Fewer non-farm jobs were added than expected in July, as the unemployment rate rose. And the weather is partially to blame.
Hurricane Beryl caused power outages in the US Gulf Coast early in July, during which the Bureau of Labor Statistics conducted its household survey. And initial unemployment insurance claims in Texas during the week following the hurricane surged to 25,202 from 13,699 in the previous week.
The BLS said that Hurricane Beryl had “no discernible effect” on the July employment and unemployment data, and the response rates were within normal ranges. But some economists suspected potential impacts.
People not at work due to bad weather rose 11 times more than the average July from 1977 to 2019, Omair Sharif, founder of Inflation Insights, wrote in a note to clients. Those who switched from full-time to part-time work because of inclement weather also soared in July to 1.089 million, including agricultural jobs.
“This is another sign that the data were impacted by the weather, and in this case it likely affected hours, and potentially average hourly earnings as well,” he said.
