In a weak jobs report, this sector did worse, fyi
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In a weak jobs report, this sector did worse, fyi
The U.S. economy added 114,000 jobs in July, which disappointed forecasters. Once again, the health sector contributed the most to the gains, creating 55,000 jobs last month. Construction generated 25,000 and hospitality added 23,000.
One of the biggest losers, though, was the information sector. That’s your data processors, your moviemakers, your software publishers and — yes, us — your broadcasters and news websites.
The information field lost 20,000 jobs in July, and its unemployment rate is sitting at an uncomfortable 5.6%, well above the national level of 4.3%.
There’s a short-term explanation and a long-term explanation. Long term, the issue is pretty straightforward, said economics professor Tara Sinclair at George Washington University. The job losses aren’t surprising, she said, because that’s been the trend in the information sector for decades.
Its share of the U.S. job base is “now quite a bit lower than it was,” Sinclair said. “It actually peaked in the 1940s.”
That seems to make sense. There aren’t many switchboard operators around any more, and plenty of newspaper scribes have moved on. Of course, computers do a lot of the data analysis we used to do ourselves. Sinclair said the information sector accounted for 4% of jobs in the 1940s. Now it’s half that.
“I don’t know how much further down, as a share of labor market, it could go,” she said. “So, if you wanted to have some good news, maybe it’s going to level off here.”
But the short-term picture is unclear. Josh Hirt, a senior economist with the Vanguard investment company, said the decline in information jobs last month is a big deal.
“This is actually a pretty meaningful deterioration from previous months where we had been, you know, sort of much more neutral,” Hirt said.
It could just be a bad month. After all, other indicators suggest the labor market in tech and entertainment isn’t struggling as much as it might seem.
“With information specifically, the wage gains have actually been quite good,” Hirt said. “So, it is something that doesn’t necessarily align with us seeing broad weakness in that sector.”
But Hugh Martin, professor emeritus at Ohio University’s Scripps School of Journalism, said he worries there may be more weakness to come. He said there’s a major force that could gobble up even more jobs.
“Artificial intelligence is clearly an enormous threat,” Martin said, referring to all kind of jobs in entertainment, communications and media.
Martin expects demand for AI in the information sector will increase.
“If you have a journalism job writing someone-said-something-on-the-internet stories, I think your job is going to go away first,” Martin said.
But original reporting, like the kind on, say, a public radio economics show — not that I asked based on personal interest or anything — Martin said those jobs are likely to stick around.
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