The U.S. economy added far fewer jobs than expected last month, and unemployment crept back up to 4.2%. Economists are watching the numbers closely, and one of them is Betsey Stevenson, a professor of economics and public policy at the University of Michigan who served on President Obama’s Council of Economic Advisers.
NPR’s Scott Simon spoke with Stevenson about the latest jobs report. The conversation covered a range of topics, from the low-fire nature of the current labor market to the unusual pattern of women taking nearly all the new jobs in healthcare. Stevenson also discussed the sharp rise in Black unemployment and what policymakers should watch between now and Election Day.
The Jobs Numbers
The Labor Department reported that the economy added 29,000 new jobs in the latest month, well below expectations. Unemployment rose slightly to 4.2%.
Stevenson described the current market as a “low-fire, low-hire” environment. “If you have a job, you’re doing OK,” she said. “You can hang on to it, but it’s hard to get a new job.”
That dynamic hurts more than just the unemployed. “Most wage gains – big wage gains – come from changing jobs,” Stevenson noted. The report showed that on average, people’s wages are not keeping up with inflation.
Women and Healthcare Hiring
In recent months, a majority of new jobs have gone to women. This month, the split was closer to equal. Stevenson looked at a longer trend.
Since July, she found that healthcare is driving almost all the hiring. Women make up the majority of workers in that industry, and it is growing. That makes healthcare the engine of job growth right now.
“It is very confusing for some people because AI is the engine of GDP growth, but it has not been an engine for job growth,” Stevenson said.
Black Unemployment Jumps
Unemployment among Black workers rose sharply, climbing by a full percentage point. That puts the Black unemployment rate more than double the rate for white workers.
Stevenson sees this as a symptom of a weak labor market, not a recession. “We’re not in a recession, but I wouldn’t call this a strong labor market,” she said.
In weak markets, workers who used to be able to move between jobs frequently find themselves left out. When you break down the unemployment rate by group, you see more volatility. A big jump in a month, Stevenson cautioned, should be met with some skepticism.
“I always want to have a little bit of caution,” she said. “That’s why you’re hearing some caution in my voice.”
She described the pattern as matching a K-shaped economy. “People who are doing well are still doing well,” she said. “Any kind of worker who’s struggling to get their foot in the door, keep their foot in the door, get a promotion to the next thing – those are the people who are really struggling right now.”
Fear of Quitting
The weak labor market has created a vicious cycle. When workers are afraid to quit their jobs because they think they won’t find another one, they don’t create openings.
“That will start to slow the economy down,” Stevenson said. “If you’re afraid to quit your job, Scott, because you think you’ll never find another one, then you can’t create another opening for someone else.”
Fewer people quitting means fewer job openings. The result is a cycle that leaves everyone worse off.
Consumer Confidence and the Election
Between now and Election Day, Stevenson is watching consumer confidence. There is a disconnect, she said: people say they are unhappy about the economy, but their behavior tells a different story.
“We did see some job growth in leisure and hospitality and people going out to restaurants,” she noted. “So the question is, are they showing behavior that’s indicative of being frightened?”
If consumers are acting scared, that could slow the economy. Stevenson thinks policymakers need to focus on jobs and affordability. “That’s certainly the front of mind of most Americans,” she said.
The Bottom Line
The jobs report shows a labor market that is working for some and failing for others. The healthcare sector is hiring, but it is hiring mostly women. Black workers are bearing the brunt of the weakness.
Stevenson’s analysis points to one central problem: fear. Workers are afraid to quit, so they don’t create openings. Those openings are the lifeblood of a healthy labor market.
The result is a cycle that leaves everyone worse off. “We’re all much better off in the labor market if we can all chase our dreams, find those new opportunities,” Stevenson said. “The opportunity we’re leaving for something else is someone else’s opportunity to get ahead.”
The numbers are clear. The solutions are harder. But Stevenson’s message is consistent: the economy is not serving everyone evenly, and the people who are suffering are not the same people who are thriving.
Key Facts Box
– Unemployment: 4.2%
– New jobs added: 29,000
– Jobs going to women: majority
– Black unemployment rise: +1 percentage point
– Women holding jobs: majority
– Since July, healthcare: engine of job growth
– AI: engine of GDP growth
The conversation with Stevenson offers a clear window into how economists read these numbers. The gender gap in hiring is not a mystery once you look at healthcare. The weak labor market is not an abstraction once you look at who gets left behind.
Source material: “Economist Betsey Stevenson breaks down the gender gap in recent hiring reports,” NPR.
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