The all important July non-farm payrolls number was released this morning and it contained some positive news for the economy and the stock market. In July employers cut 247,000 jobs, far less than most analysts were expecting. The average analyst estimate was for a loss of 320,000 jobs during the month of July. Revisions from May and June’s job data also lowered the numbered of jobs lost by 43,000. The unemployment rate now stands at 9.4%.

What were the weakest parts of the jobs market in July? The construction sector cut 76,000 jobs in the month and retailers cut 44,000 jobs. Both of these numbers represent an increase from the amount of jobs lost in these sectors in the previous few months. Where were the bright spots? The consistent standout of late has definitely been the health care sector, which added 20,000 jobs in the month. Another surprise to the upside were the leisure and hospitality payrolls adding 9,000 during July.

As one would expect the stock market responded in a very positive way to what is the best employment report since last September.  On the other hand treasury prices fell markedly today as thoughts than an economic recovery may be nearer than expected fueled selling of treasuries. The dollar was very strong, and crude oil and gasoline futures fell because of the report.

What does this mean for the average individual? It means that there may be a little bit of light at the end of the tunnel, but it also isn’t an all clear signal. Be cautious not to get too positive over a jobs report that shows a quarter of a million jobs lost in the past month. The prospects for an economic recovery are certainly brighter than they were several months ago, but one would be wise to keep perspective on where we are at in the cycle. Progress is being made, which is great, let’s just hope it is a trend that continues!