Happy Friday! The government will release its July jobs report today.

It’s expected to show the US added 175,000 jobs on the month, and unemployment held steady at 4.1%, according to FactSet estimates.

That said, our view at Opening Bell Daily is that the official data rarely tells the full story.

So we reached out to LinkedIn’s economics team to produce an exclusive, more dynamic jobs report for Opening Bell Daily readers.

Tackle your credit card debt with 0% interest

If you have outstanding credit card debt, getting a new 0% intro APR credit card could help ease the pressure while you pay down your balances. Our credit card experts identified top credit cards for balance transfers that are perfect for anyone looking to pay down debt and not add to it!

See what all the hype is about.

How Americans are actually faring in the job market

As Jerome Powell so often says, the Fed makes decisions based on data. 

Yet the government often revises its data after its release, so relying on official figures is not always the best option. 

Opening Bell Daily obtained exclusive data from LinkedIn to produce what we consider a more reliable, dynamic jobs report based on insights drawn from the one billion people who use the platform. 

Powell said Wednesday that the labor market remains relatively robust, but LinkedIn’s internal tracking suggests pockets of weakness are already there. 

According to the LinkedIn data: 

Companies are adding fewer employees

The LinkedIn Hiring Rate, which tracks the number of hires divided by total LinkedIn membership, is down 8.1% in June year-over-year.

Since May, it’s down a sharp 2.2%. 

All year, it’s hovered at levels seen right at the onset of the COVID-19 pandemic, and well below what was typical pre-pandemic.

More employees are staying put and fewer people are starting new jobs. 

This varies across the top 20 US metros. Every region saw month-over-month hiring slowdowns in June except for the Minneapolis-St. Paul region, which stayed flat.

Below shows the LinkedIn Hiring Rate for eight of these 20 areas. As of June, Miami is the only one that is above typical levels seen before the pandemic. 

Breaking down the LinkedIn Hiring Rate for specific industries shows how it varies further.

Below illustrates the rate for government jobs, healthcare, technology & media, education, construction, and retail since January 2020.

Retail hiring saw the steepest drop-off when the pandemic began. It’s also seen the weakest recovery.

Tech saw the second-steepest drop off in 2020, the biggest boom in 2022, and now the second-weakest hiring rate. 

Hiring for construction and education lead the way, and healthcare and government jobs are close behind. 

Each industry shows more of a decline than a moderation over the last several months — which suggests Powell may be overstating the strength of the labor market as a whole.

Job hunting has ramped up, but quitting has slowed

While hiring is slowing down across most industries, LinkedIn members continue to seek new jobs at an aggressive pace. 

The platform’s Job Search Intensity Index, which tracks a 3-month average for the number of job applications per person, is up 9% in June compared to one year ago.

As it turns out, LinkedIn members are applying to more jobs at the same time hiring is trending lower.

It’s hovered at the same rate since March, though it has steadily climbed for the last three years as Americans have adapted to work-from-home trends.

The index is about 40% higher now than it was in June 2021, when tracking began.

Meanwhile, members’ confidence to find a new job is “very low” right now, according to the platform. 

That takes us to the LinkedIn Separation Rate, which measures the rate people are leaving their job. 

This is similar to a quit rate. It’s better at tracking voluntary quits rather than people getting fired.

This measure has been flat since last summer, which means the labor market is showing stability, but not necessarily strength. 

The pace of members leaving jobs remains slower than pre-pandemic, indicating that employers either have fewer job openings or opportunities that aren’t that enticing. 

Remember, this is part of what the Fed has been trying to engineer, though they may not say it explicitly. 

By holding interest rates at two-decade highs, the cost of capital stays expensive, which forces companies to tighten their belts and pull back on hiring.

Analysts expect the unemployment rate for July — set to release today — to hold steady at 4.1% annually. That would be the same as June, which marked the first time it reached that level in nearly three years.

In Powell’s view the labor market looks solid, even as the pace of job growth is cooling.

“A broad set of indicators suggest that conditions in the labor market have returned to about where they stood on the eve of the pandemic,” Powell said. “Strong, but not overheated.”

The LinkedIn data, however, points to cracks in the labor market perhaps beyond what central bankers have acknowledged.

Here’s what LinkedIn’s head of economics for the Americas, Kory Kantenga, told me this week:

“The issue with the labor market right now is that there may not be much room left to slow down before employers decide to cut costs and start laying people off. There’s an undertone of that risk in what the Fed has been saying.”

We hope you enjoyed this special edition report, produced with exclusive data from LinkedIn’s economics team. If you found it insightful, consider sharing it on socials or sending it to a friend.

Feedback? Hit reply to this email or let me know on X @philrosenn.

Interested in advertising in Opening Bell Daily? Email phil@openingbellmedia.com