Goldman's chief economist isn't cheering after jobs report: 'This is a somewhat dated number'

Published Fri, Aug 7 202011:29 AM EDT

(This story is for CNBC Pro subscribers only.) The Labor Department's July jobs report, which came in better-than-expected, is positive, but jobs growth could falter in the face of rising cases and new restrictions, according to Goldman Sachs' chief economist. "I think today's number is encouraging overall, relative to the expectations, but of course we also have to see," Goldman chief economist Jan Hatzius told CNBC's "Squawk on the Street" on Friday. "This is a somewhat dated number and we'll see in the August report how well job growth is holding up in the face of the renewed restrictions on activity." The Labor Department said Friday nonfarm payrolls rose by 1.763 million in July, higher than the estimated 1.48 million, according to economists polled by Dow Jones. The unemployment rate fell to 10.2% from its previous 11.1%, compared to the estimate of 10.6%. May and June saw a combined increase of more than 7.5 million, the fastest two-month rise in U.S. history, showing that the two-months of record growth slowed in July. "If you look at the share of states that are opening versus restricting activity there's obviously been a sizable shift and that's probably going to be visible in the August number as well," said Hatzius. Hatzius said a bright spot of the report is that there is still a large number of Americans who are being temporarily laid off but will eventually be hired back. "The share of unemployed workers that are on temporary layoff is still close to 60%, which means that there is still room for employment to grow if the health situation allows and that does suggest that we have not yet seen the scarring effects, the way in which unemployment can become permanent," said Hatzius. Hatzius said the data is somewhat "stale" and said there is some data pointing to the August jobs report being "weaker." "While the new cases have come down and the percent positive testing rate has come down somewhat as well, we're still at very high levels of new infections and that means we're constrained on activity," Hatzius added.

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(This story is for CNBC Pro subscribers only.)

The Labor Department's July jobs report, which came in better-than-expected, is positive, but jobs growth could falter in the face of rising cases and new restrictions, according to Goldman Sachs' chief economist.

"I think today's number is encouraging overall, relative to the expectations, but of course we also have to see," Goldman chief economist Jan Hatzius told CNBC's "Squawk on the Street" on Friday. "This is a somewhat dated number and we'll see in the August report how well job growth is holding up in the face of the renewed restrictions on activity."