United States employers added new workers at a surprisingly strong rate in June after an unnerving stall in May, in a clear demonstration of economic resilience, the Labor Department reported Friday.
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The US economy added 287,000 net new jobs – its best performance for eight months – smashing estimates following two previous months of weak hiring.
Health care and social assistance added more than 58,000 jobs as hospitals, clinics, nursing care facilities and child day care centers added workers.
May’s payroll gain – the smallest since September 2010 – in part reflected the loss of 35,100 Verizon workers, who were excluded from the count while on a month-long strike.
Unemployment rates rose for most demographic groups in June, but largely for an encouraging reason: More Americans started or renewed job hunts, and many didn’t immediately land work. Wage growth, another indicator of economic strength, slowed slightly, bringing the annual pace for the last three months to 2.5 percent, compared with the 12-month rate of 2.6 percent. But a really strong jobs report could also leave Wall Street antsy because it increases the likelihood the Federal Reserve will raise interest rates this year. There seemed to be a sigh of relief on even Wall Street that the USA economy still looks solid.
The unemployment rate, which is derived from a separate Labor Department survey of households, increased from 4.7 percent in May.
The persistence of moderate gains may just indicate that labor markets are approaching capacity limits reflecting supply-side issues rather than firms opting to moderate hiring in the face of slowing demand, according to Paul Ferley, assistant chief economist at RBC Economics.
The U.S. economy hit the pause button this spring. That sentiment signaled a shift from their April meeting, when many the policymakers had indicated that they were prepared to raise rates if the job market and the economy continued to improve.
Despite expectations of upward revisions, on Friday, the Department of Labor revised May’s figure from 38,000 jobs to 11,000. That is still below traditionally healthy growth of about 3.5 per cent.
Those employees returned to work in June, fueling an increase of 28,100 telecom jobs last month. The year-over-year (YoY) hike was 2.6%, lower than the forecasted 2.7%.
Politico Pulse reporter Dan Diamond stated on Twitter the healthcare sector is on pace to become the biggest in the US within the next three years.
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Factory jobs increased by 14,000 after a 16,000 drop in May as the manufacturing sector continues to recover from a slowdown triggered by the strong dollar and weak commodity prices.
