U.S. adds 213,000 jobs in June, unemployment rate jumps…

Posted July 09, 2018

Revised figures for April and May bring the monthly average for this year to 214,000 jobs-up from 182,000 the year before.

The report showed little, if any, evidence of tariff-related weakness in the economy, especially with continued strength in goods-producing jobs.

The number of workers who have been too discouraged to bother searching for a job was down 155,000 from a year earlier, leaving the total below 360,000. The agency's Bureau of Labor Statistics issued its monthly look at the employment situation in the USA, showing a rebound in the legal services sector after more tepid results in May. At more than 1.141 million people employed in the industry in June, the legal jobs figures edged outside of a range that has prevailed since December 2016. That was the first increase in the jobless rate in 10 months. It's the 93rd consecutive month of job gains, an impressively long and strong stretch of growth.

They expect the unemployment rate to have held steady at 3.8%, the lowest level since 2000 and 1969 before then. "There were some people who weren't participating in the labor force who are now being encouraged to return, so I'm not concerned about the uptick in unemployment", said Catherine Barrera, chief economist of the online job site ZipRecruiter. The education and health sector added 54,000.

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Staffing in "professional and business services" (+50,000) received boosts from "temporary help services", +9,000; "architectural and engineering services", +7,000; and "computer systems design and related design", +6,000. The median estimate of analysts surveyed by Bloomberg called for a gain of 195,000 jobs.

The healthy payroll expansion undertaken by architectural and engineering firms is encouraging news for contractors. And that, in turn, means that more people are optimistic about finding work.

Manufacturers are expected to have added another 15,000 jobs to their payrolls in June on top of the 18,000 created in May.

Nearly half of June's construction jobs increase (+13,000) occurred in the "heavy and civil engineering" category, +6,000.

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The labour force growth is likely to be welcomed by the Bank of Canada, which has been arguing that pockets of untapped market slack remain that could limit wage and price pressures. There are two tables focusing on compensation in the Employment Situation report, B-3 and B-8.

Still, average hourly pay rose just 2.7 per cent in June from 12 months earlier, meaning that after adjusting for inflation, wages remain almost flat.

Update: Here's another chart, this one showing monthly job losses/gains in just the private sector since the start of the Great Recession. That kept the annual increase in average hourly earnings at 2.7 percent. That followed a 25,100 gain in May. But retailers shed 21,600 jobs, with the losses concentrated at general merchandise stores.

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