The mean monthly payroll gain in the 1st 5 months of 2015 is 215,000, though it is considered slower than the pace of hiring in late 2014, the report from the Labor Department on Friday showed employers to be steady last month.
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Both the unemployment rate of 5.3 percent and the number of unemployed – 8.3 million – were unchanged.
Justin Wolfers, a senior fellow at the Peterson Institute for global Economics who has been incredibly upbeat about recent jobs reports – and remained thrilled with the July numbers – also noted the lackluster wage growth.
Jason Furman, the head of the White House Council of Economic Advisers, said in a statement: “Over the past two years, our economy created 5.7 million jobs, the strongest two-year job growth since 2000″. Businesses have added jobs for 65 straight months, the longest such streak on records dating to 1939.
The July jobs report “without a doubt” shows the further improvement that the Fed was looking for in the labor market, said Jim Dunigan, chief investment officer at PNC Wealth Management, paving the way for a September rate increase. The possibility of raising the federal interest rate above the 0 per cent threshold it was set at to stimulate post-recession recovery has been has attracted numerous critics from investor, who consider that it would slow the country’s much needed economic growth. Still, uncertainty remains over how the market will adjust to slightly higher rates, since the central bank’s low-rate policy has helped fuel the six-year bull market in stocks that has lasted since the financial crisis.
Jerome Powell, a Federal Reserve governor, said earlier this week that nothing had been decided and that whether the Fed raises interests rates will depend on the data to be released before the September Fed meeting. Janet Yellen, the Fed Chair said that a rate hike was very likely this year & the meeting next month is just one of three which will be held before this year ends. Compared with a month earlier, hourly pay rose 0.2 percent, to $24.99. But average hourly wage growth has barely exceeded low inflation of around 2 percent. In addition, the average workweek increased to 34.6 hours, the most since February, from 34.5 hours in June. The retail sector added 35,900 jobs.
Economists believe a rate rise by the US Fed in September could see the Bank follow suit sooner rather than later.
Although Canada gained 6,600 jobs in July, leaving the unemployment rate steady at 6.8 per cent, Guitard said full-time jobs in the private sector were replaced by part-time jobs and self employment.
U.S. stocks fell after the jobs data as traders saw a greater chance of a rate hike next month.
“The Fed is close to tightening-it doesn’t need to see a lot more improvement, just a little more“, Dana Saporta, an economist at Credit Suisse Securities USA LLC in New York, said before the report. But productivity fell at a 3.1 percent annual rate in the first three months of 2015.
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But given that the Fed is nearing an important policy turning point, namely a decision to raise interest rates for the first time in nine years, the fact that there are highly consistent signals about what is happening in the labor market actually is welcome in its own right.
