Private businesses and government authorities generated 287,000 new positions last month, 112,000 more than analysts had expected. Last month, the initial May report showed the USA unemployment rate came in at 4.7 percent, a recent low, but nonfarm payrolls only grew a dismal 38,000 jobs. May’s report was revised even further down, however, to just 11,000 jobs, while April was revised up by 21,000 extra jobs. The stronger spending led economists to forecast that annualized growth rebounded to 2 per cent or more in the April-June quarter.
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The leisure and hospitality industry saw the most significant increase of new jobs at 59,000, followed closely by healthcare and financial industries.
Employment in professional and business services continued to trend up in June (+38,000). June payrolls were expected to be boosted by 35,000 Verizon workers who returned from a strike that had suppressed May employment by a similar amount.
Average hourly wages rose a modest 2 cents to $25.61 and are up 2.6% the past year, in line with a recent pickup, but earnings have yet to surge higher despite the near-normal unemployment rate.
Even with June’s success, though, the labor market still averaged only 147,000 new job additions over the last three months, which is well shy of the 200,000-plus pace employers maintained at the end of 2015.
Strong hiring, if sustained, could complicate Donald Trump’s efforts to portray the US economy as faltering. This growth falls in line with average monthly gains over the previous year in each industry, according to data from the Department of Labor. The yield on the 10-year U.S. Treasury note this week touched a record low of 1.34 percent, though it rose to a still very low 1.4 percent after Friday’s jobs numbers.
A healthy job market, if sustained, could complicate Donald Trump’s efforts to portray the USA economy as faltering. The year-on-year gain in earnings rose to 2.6 per cent after advancing 2.5 per cent in May The signs of economic strength would be welcomed by Fed officials.
But O’Sullivan expects the federal Reserve will continue to keep United States interest rates on hold at its end-July meeting. Economists say unseasonably warm weather at the start of the year had pulled forward hiring in these areas, leading to payback in the last two months. Five of its eight North American factories are in Wisconsin, Krenke said, where the unemployment rate is just 4.2 percent. While this raises the possibility the Federal Reserve will raise interest rates in 2016 a bit, the stock market still rallied.
If it turns out that employers did add almost 200,000 jobs in June, it would mark a reassuring turnaround from a dismal May, when they added just 38,000, the fewest in more than five years.
According to the Department of Labor, there were about 5.8m open jobs at the last count – a statistic that the labor secretary, Tom Perez, made sure to highlight when speaking about the disappointing jobs report last month.
That rise was mainly due to a large jump in the number of people reported rejoining the workforce, diluting the impact of the hiring surge on the jobless rate.
Earlier this year there had been speculation that the Fed could raise interest rates as soon as July. The Atlanta Federal Reserve Bank is now forecasting the economy growing at a 2.4 percent pace in the second quarter.
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Construction payrolls were unchanged after two months of declines.
