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New Jobs Report: Unemployment Rate Down To 3.9 Percent

Aug 3, 2018
Originally published on August 3, 2018 8:13 am
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RACHEL MARTIN, HOST:

Got economic news to share this morning. The new jobs report is out, and it shows that the U.S. economy added 157,000 jobs in the month of July. That has pushed down the unemployment rate to 3.9 percent. Joining us to talk more, NPR senior business editor Uri Berliner. Hey, Uri.

URI BERLINER, BYLINE: Hey, Rachel.

MARTIN: Three-point-nine percent. I mean, that's real low. What does it tell us about the overall health of the economy right now?

BERLINER: Absolutely. Really low. This is basically what's considered full employment, which means that if you want a job, there's one out there for you. Three-point-nine percent is really a pretty historically low number. It reflects a job market that has continued to be strong, a job market where employers are really eager to hire workers.

MARTIN: That's all good news. And, also, wages ticked up a bit, which is significant because we've been talking for a long time about how wages were just stuck. They were just plateauing and not moving upwards. That's changing?

BERLINER: Right. The key word there is a bit. They're growing at an annual rate now of 2.7 percent, which is OK. It's not great. And this has been one of the great puzzles of this recovery. So much hiring. Employers so in need of workers. Why aren't they paying more?

MARTIN: Right.

BERLINER: Which is really an interesting part of this recovery. Maybe that's starting to change somewhat, but not really at full force.

MARTIN: All right. I'm going to switch gears because there is more tariff news this morning. China has announced that it plans to impose more tariffs, retaliatory trade tariffs, if the Trump administration moves ahead with its latest threat to raise tariffs on $200 billion of Chinese goods. This is an announcement that the administration just made some days ago. President Trump insists that trade wars are easy to win. Is this what winning looks like?

BERLINER: I don't know if it's what winning looks like. This is definitely an escalation of tit for tat. China now says it is prepared to impose tariffs on $60 billion of U.S., of American goods. This only would follow if the Trump administration goes ahead with its threat to impose tariffs of, perhaps, as high as 25 percent on $200 billion worth of Chinese goods.

MARTIN: So far, when we think about this trade war - which it is at this point. We can call it that - have we seen an effect on the economy of the tariffs that actually have been implemented?

BERLINER: Well, not if you look at this jobs report. I mean, one key sector to look at when tariffs are imposed is manufacturing. But manufacturing hiring was very strong in the last jobs report, 37,000 jobs. That's the highest in some time. So if you were going to see an immediate impact, negative impact from the tariffs, it would be in manufacturing, where higher steel and aluminum costs would start to affect the ability of companies to produce. And those - we haven't seen that yet.

MARTIN: Do we know, Uri, if talks are happening right now? I mean, is there anyone from - we think about Robert Lighthizer, U.S. trade rep. Is Lighthizer or any of his representatives, are they in direct communication with someone on the Chinese side on a regular basis about how to put an end to this?

BERLINER: We know that there's been a stalemate in talks, that there have been talks previously and they've broken off. Don't really know the status of them now, but we have to assume there's some backchannel communications to see that this doesn't get completely out of hand.

MARTIN: NPR senior business editor Uri Berliner. Thanks Uri.

BERLINER: You're welcome. Transcript provided by NPR, Copyright NPR.