WASHINGTON - The U.S. unemployment rate has fallen from 4 percent to 3.9 percent in July - bringing it to an 18-year-low, the Labor Department declared Friday.
Employers added 157,000 jobs last month - 37,000 of which were manufacturing jobs.
Manufacturing outperformed the rest of the economy. Manufacturing saw the biggest gain since December and July marked the third straight month of factory job growth.
Of those manufacturing jobs, transportation performed the heavy lifting with 13,100 new jobs. But durable goods industries also saw many increases: fabricated machinery is up 5,800 jobs, metal products manufacturing is up 5,100 jobs, and miscellaneous manufacturing is up 3,600.
Wood products saw a slight decline of 700 jobs.
Construction saw an increase of 19,000 jobs despite a worker shortage and lower housing supplies.
Average hourly earnings across all industries rose an average of 2.7 percent from 2017 - unchanged from June.
Less-educated workers saw a greater increase. The unemployment rate for high school graduates fell from 4.2 percent to 4 percent and from 5.5 percent to 5.1 percent for people without a high school diploma. College grads, however, saw a lesser increase - from 2.3 percent to 2.2 percent. This could be the result of employers having to relax its hiring requirements to find workers.
A low unemployment rate suggests a tightened labor market. We've seen wood industry companies, like furniture giant Ashley Furniture, begin implementing perks to get people to work, including offering a shuttle service that gives employees free rides to work. Walcraft Cabinetry has begun hiring ex-criminals and offenders.
But despite a potential struggle for some companies to find workers, monthly job growth has averaged 200,000 this year - up from 182,000 in 2017. Many economists told Bloomberg that they believe the additional labor supply will soon run thin, counterbalancing job growth and pushing unemployment even lower.
A broader measure of unemployment by Reuters found that the number of people who want to work but had given up searching dropped three-tenths of a percentage point to 7.5 percent, the lowest level since March 2001.
Tariffs are also beginning to be a concern to many of America's leading companies. An analysis by CB Insights found that mentions of the word "tariff" on earnings calls of S&P 500 companies hit a record high in the second quarter - even before the Trump Administration threatened 10 percent Chinese tariffs in July. The S&P 500 represents 500 of America's biggest firms.
Since July, Trump has considered bringing the proposed 10 percent tariffs to 25 percent - provoking a potentially potent retaliation from China.
We will see what happens.
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