Economy

Labor Department Announces an Increase in US Jobs By 213,000

Labor Department Announces an Increase in US Jobs By 213,000

After unemployment dropped to 3.8 percent in May, sparking worries of labor shortages, over 700,000 women joined the labor force in June, thus cooling the job market. "Not only did payroll employment increase by 213,000 - evidence that employers are finding workers - but wage growth held steady at a disappointing 2.7 percent - evidence that employers are not having to raise wages to attract and retain workers". The average hourly wage has increased by just 2.7 percent in the a year ago.

It would also be important to watch secondary indicators of employment that are not as impressive as the headline unemployment rate, such as the share of people who are working part-time but would prefer full-time jobs.

Manufacturers added 36,000 jobs last month. A widespread availability of jobs and the prospect of higher wages at other employers made it harder to retain workers, she said.

The job gains in the establishment survey were broadly based. That's an increase in total employment of a quarter of a million jobs.

Even so, a steady pace of hiring and gradually rising wages, along with lower taxes, are helping underpin consumer spending and propelling a rebound in USA growth. And as is the case in most months, professional and business services as well as education and health services were the sectors that saw the largest increase in employment, with 50,000 and 54,000 jobs added in these sectors respectively.

The gain in US total employment through the first half of this year has been 1.3 million jobs. This may be due to erratic seasonal factors.

Even nicer, another 37,000 new jobs were added to April and May. Only retail showed a significant loss while many other sectors remained largely unchanged. Nonetheless the EPOP for men is still 0.9 percentage points above its year-ago level, compared with 0.7 percentage points for women.

United States hiring topped forecasts in June while unemployment rose from an 18-year low and wage gains unexpectedly slowed, indicating the labour market has room to keep expanding. That's good news for markets, which tend to rise when bond rates are low. That's tied with Florida (the fifth worst) for having the lowest unemployment insurance period in the country. The unemployment rate nevertheless saw a small uptick.

The unemployment rate in June fell back slightly to 4.0% from 3.8% in May. The driving force behind the surge, however, is frictional unemployment, characterized by workers' confidence to switch jobs in today's economic climate. While 12.4 percent is still high for this recovery, it is well below the rates of more than 14 percent seen the last time the unemployment rate was this low in 1999 and 2000.