But June and July’s numbers have surged again, with 292,000 new jobs in June and 255,000 in July, bringing the year’s total to 1.3 million new jobs, and keeping the unemployment rate at 4.9 percent.
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The Labour Department’s closely-watched employment report yesterday showed that nonfarm payrolls increased by 255,000 jobs last month.
Job gains in the USA economy were fairly broad-based, occurring in professional and business services, health care, and financial activities. This industry has added an average of 18,000 jobs per month thus far this year, compared with an average monthly gain of 30,000 in 2015. Job gains have swung sharply in recent months, from a meager increase of 11,000 in May to an explosive gain of 287,000 in June.
Average hourly earnings for July rose 8 cents, to $25.69, with the annualized rate of wage growth at 2.6 percent.
Job growth in 2016 remained “well above the pace needed to maintain a low and stable unemployment rate”, said Jason Furman, chairman of the White House Council of Economic Advisers.
A strong jobs market increases the likelihood that the Federal Reserve will resume its effort to normalize monetary policy later this year by raising interest rates. In July, despite its expectations that the job market would continue to strengthen, the Fed chose to leave the United States interest rates unchanged for the fifth time this year. Economists surveyed by The Wall Street Journal were expecting a modest 179,000 jobs added.
One curious counterpoint: While job growth has averaged 190,000 in the last three months and 206,000 in the last 12 months, inflation, both in terms of wages and in broader measures, has remained quiescent.
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Economist could find few signs of weakness in the report that would give the central bank cause to delay a rate hike. Hourly earnings have risen by 2.6 percent over the past year. The rate includes involuntary part-time workers, discouraged workers, and workers who have dropped out of the labor force but are still able to work. The number of temporary jobs reached 2.93 million, its highest level since December. Retail sector employment increased by 14,700 jobs and payrolls in the leisure and hospitality sector rose by 45,000. Economists expected an addition of 185,000 jobs and an unemployment rate of 4.8 percent, according to Forbes.
