The change in the number of jobs over time is the net result of increases and decreases in employment that occur at all businesses in the economy. BED statistics track these changes in employment at private business units from the third month of one quarter to the third month of the next. Gross job gains are the sum of increases in employment from expansions at existing units and the addition of new jobs at opening units. Gross job losses are the result of contractions in employment at existing units and the loss of jobs at closing units. The difference between the number of gross jobs gained and the number of gross jobs lost is the net change in employment.
Private Sector Establishment-Level Gross Job Gains and Gross Job Losses
Opening and expanding private sector business establishments gained 7.3 million jobs in the second quarter of 2008, an increase of 128,000 from the previous quarter. Over the quarter, expanding establishments added 5.9 million jobs while opening establishments added 1.4 million jobs.
Gross job losses totaled 7.8 million, an increase of 351,000 from the previous quarter. During the quarter, contracting establishments lost 6.3 million jobs, while closing establishments lost 1.5 million jobs.
The difference between the number of gross jobs gained and the number of gross jobs lost yielded a net change of -493,000 jobs in the private sector for second quarter 2008.
Gross job gains represented 6.4 percent of private sector employment, while gross job losses represented 6.8 percent of private sector employment.
Major Industry Sector Gross Job Gains and Gross Job Losses
From March 2008 to June 2008, gross job losses exceeded gross job gains in all but five industry sectors: natural resources and mining, utilities, information, education and health services, and other services.
Goods-producing. Expanding and opening establishments in the goods-producing sectors accounted for 1,494,000 jobs gained, and contracting and closing establishments accounted for 1,778,000 jobs lost. This net loss of 284,000 jobs results in the eighth consecutive quarter of net loss for these sectors of the economy.
Construction. In construction, gross job gains fell over the quarter to 737,000. Gross job losses increased to 922,000, resulting in a net
loss of 185,000 jobs. This is the lowest level of gross job gains since the first quarter of 1994, and the highest level of gross job losses this sector has experienced since this time series began in 1992.
Manufacturing. Gross job gains grew to 477,000 while gross job losses fell to 588,000. The net loss of 111,000 jobs is the eighth consecutive quarter of net job losses in the manufacturing sector.
Service-providing. In the service-providing sectors, gross job gains increased to 5,764,000 and gross job losses increased to 5,973,000. Job gains at expanding establishments increased to 4,590,000 jobs, while job losses at contracting establishments increased to 4,791,000 jobs, resulting in a net loss of 209,000 jobs.
Retail Trade. In retail trade, gross job gains decreased to 939,000 and gross job losses increased to 1,080,000 for a net loss of 141,000 jobs. This is the second highest net loss in this industry since the series began in 1992, second to only the third quarter of 2001.
Education and Health Services. Gross job gains increased slightly to 788,000 jobs in the second quarter, while gross job losses increased to 715,000. This industry sector is the only one which has experienced a net positive change in every quarter since this series began in 1992.
Financial Activities. Gross job losses exceeded gross job gains in the financial sector for the fifth consecutive quarter. Gross job gains fell to 394,000, while gross job losses increased to 455,000.
Number of Establishments Gaining and Losing Employment
Another way to look at the dynamics of business activities is to monitor the number and proportion of business units that are growing
and declining. In the second quarter of 2008, the number of establishments losing jobs exceeded the number of establishments gaining jobs.
Out of 7 million active private-sector establishments, a total of 2,024,000 establishments lost jobs from March 2008 to June 2008. Of these establishments, 1,633,000 were contracting establishments and 391,000 were closing establishments. Of the establishments gaining jobs, 1,479,000 establishments were expanding and 355,000 establishments were opening, resulting in 1,834,000 establishments gaining jobs.
The number of closing establishments exceeded the number of opening establishments, resulting in a net loss of 36,000 private-sector establishments during the quarter. This is the highest net decline in establishments that has been observed since the time series began in 1992, and the first time that the net number of establishments has declined for two consecutive quarters.
Firm-level Gross Job Gains and Gross Job Losses by Size Class
From March 2008 to June 2008, firms with 1,000 or more employees experienced an increase in their share of gross job gains with 16.8 percent, and experienced an even larger increase in gross job losses with 18.2 percent.
Gross Job Gains and Losses by State
In the second quarter of 2008, 11 states and the District of Columbia experienced net employment growth while 39 states, Puerto Rico, and the Virgin Islands experienced net job losses. Alaska and Wyoming had both the highest rates of gross job gains (11.5 and 8.7 percent, respectively) as well as the highest rates of gross job losses (9.7 and 10.4 percent, respectively).
