NCCI’s Labor Market Report Provides Key Insights on Workforce Trends and Economic Conditions

The Labor Market Insights report provides a comprehensive monthly overview of key labor market statistics through a workers compensation lens. This valuable resource offers detailed analysis on drivers of premium and frequency, alongside NCCI’s perspectives on the latest jobs report's implications for the industry.

Drivers of Premium - Key Insights

•              The July jobs report showed the weakest labor market growth in some time. Private employment growth dropped below 100,000 jobs for the first time in 2024. Hourly wage growth slowed while average hours worked decreased slightly, which led to a stagnant month for average weekly earnings. Meanwhile, May and June employment numbers were revised downward from the prior report by a combined 29,000 jobs.

•              Job gains remained robust in health care and social assistance (up 64,000) and construction (up 25,000), while only one sector—information—saw steep losses (down 20,000). The 4.9% year-over-year payroll growth we calculate remains above the 2015–2019 average of 4.6%. Overall, the news remains more indicative of a balancing labor market than a very poor one.

Drivers of Frequency - Key Insights

•              Unemployment and labor force participation also tell a mixed story. In July, the unemployment rate posted another uptick to 4.3%, but total employment rose thanks to continued increases in labor participation. The prime-age participation rate of 84.0% was higher in July than in any month since the year 2000. Adding workers generates payroll growth.

•              Nearly three-fourths of July’s increase in unemployment came from temporary layoffs. The number of long-term unemployed people was virtually unchanged from June. Upcoming reports will shed light on whether these temporary layoffs are a blip, potentially reflecting in part weather-related closures from Hurricane Beryl, or an early sign of a significantly slowing labor market.

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