The pace of job growth in July was unchanged from the 1.7 percent annual rate of previous months, but the details suggest an economy that will do modestly better for the rest of the year. Most importantly, jobs in business services were up 3.5 percent from last year.
Business services is one of the largest sectors of the economy, on a par with health care and government, and bigger than retail or manufacturing. Earlier this year it was growing at a 3 percent rate, in the last few months around 3.5 percent; it seems only a small increase but it means that businesses are expanding again.
A slightly disturbing sign is that jobs in manufacturing, which were growing at a 2 percent rate early this year, are now not increasing at all. New jobs in car manufacture are offset by job losses in computers and electronics.
In other sectors, jobs were flat in government, up 1.8 percent in health care, up 2.4 percent in retail, and up almost 4 percent at restaurants. We've noted before that many of these jobs have low pay, boosting rentals more than home buying.
Unemployment fell to 7.4 percent. Gross domestic product grew 1.7 percent in the second quarter. Fortunately, government spending was not down as much as in the first quarter, but surprisingly large imports took 1.5 percent off what otherwise was very good growth.