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Labor Report: Factory Hiring Soft in August, but Manufacturing Job Openings on the Rise

Posted by IndustrySelect on Friday, September 4, 2020

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New data released by the Bureau of Labor statistics shows the U.S. added 1.4 million jobs in August and the unemployment rate fell to 8.4%. This is roughly in line with 1.8 million jobs added in July.

The U.S. manufacturing sector added jobs in August as well, but hiring was far softer than in other sectors.

The Department of Labor reports the sector added 29,000 positions in August, slightly above the 26,000 jobs added in July, but well below 356,000 jobs it added in June (or the 225,000 gained in May).

Manufacturing hiring has lagged behind other strides made in the sector, such as surges in new orders and output, currently 720,000 jobs short of pre-pandemic levels.

This is in keeping with the Institute for Supply Management’s report on manufacturing activity for the months of July and August, which found that although activity is in expansion overall, with production and new orders soaring, employment is lagging behind. Today, we're taking a look at manufacturing job gains and losses by subsector and also manufacturing job opening numbers. 

August 2020 Manufacturing Job Gains by Sector

Manufacturing currently accounts for 12,132,000 jobs, or roughly 9% of total U.S. non-farm employment. Gains were overwhelmingly led by the non-durable goods category, which accounted for 27,000 new jobs. Durable goods, by contrast, added 2,000.

This is because, in sharp contrast to previous reports, transportation equipment, which had overwhelmingly led gains in the past several months, took a step back, shedding 8,400 jobs. Leading gains instead last month was food manufacturing, which added the most jobs in August, up by 12,000 positions.

Next in line was the plastics and rubber products sector, which gained 6,500 jobs, followed by fabricated metals products, which gained 5,900, and furniture, which added 5,700. Apparel gained 3,200 jobs, while electronic instruments saw a 1,400-job gain.

August 2020 Manufacturing Job Losses by Sector

Notably, there were several sectors that saw job losses in August. Losses were most severe in transportation equipment, as noted above, down by 8,400. Motor vehicles and parts shed 5,300 jobs, and nonmetallic mineral products shed 4,400.

Printing and related support activities lost 4,100 jobs, while machinery, one of the largest durable goods categories by number of jobs, shed 1,300 workers.

Job Openings in Manufacturing on the Rise

The Department of Labor’s most recent Job Openings and Labor Turnover Survey (JOLTS) released August 10th found the number of job openings specifically in the manufacturing sector rose to 386,000 in June, up 35% from May’s reported 285,000 openings.

Prior to the pandemic, job openings hit a high of 515,000 in June of 2019. 

Although it remains to be seen if July and August’s JOLTS survey numbers will reflect the softness in hiring indicated by the labor report for these months, it remains certain that hiring gaps persist in the manufacturing sector. 

Staffing and workforce development agencies are currently at the ready to help more as more manufacturers seek to fill open positions and may find their services are more in demand.

Employment staffing agencies, in fact, added 126,000 jobs in August, while temporary staffing services added 106,700 jobs, according to the most recent labor report. You can read more about 2021 forecasts for the staffing industry here.

If you’re looking to help manufacturers with their staffing and workforce needs, an IndustrySelect subscription can help you find new customers in the industrial world. To get a hands-on look at how an IndustrySelect subscription can help you reach new industrial customers, visit our website and try out a free demo.

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