GOLDMAN: The Sequester Is Hitting Private Jobs Harder Than Federal Jobs

Goldman Sachs / YouTubeEarlier today, we learned that U.S. companies added just 162,000 jobs in July, which was below the 185,000 expected. Also, the June number was revised down.

"The July employment report was on balance disappointing, as payroll jobs, income, and hours grew less than expected, and the larger-than-expected decline in the unemployment rate was partly due to declining participation," said Goldman Sachs' Jan Hatzius.

So, what happened?

Among other things, the dreaded budget cuts tied to the sequester may have had some effects. But they didn't come in the form of federal job cuts.

Here's Hatzius:

...There continued to be little if any discernible sequester impact on federal jobs as federal ex-postal service employment was essentially unchanged on the month. However, there was a bit more weakness in private industries likely to be impacted by the sequester, including non-auto transportation equipment manufacturing?which incorporates aerospace and shipbuilding?down 7k...

Other economists have argued that Federal employment has held relatively steady due to furloughs and reduced hours.

Either private companies are unable to do this, or they're getting hit harder than the public sector.