United States hiring soars in June, quieting fears of a slowdown

Jeannie Matthews
July 8, 2019

Other strong sectors included construction and manufacturing - welcome news for the housing industry, according to Fannie Mae chief economist Doug Duncan. NPR's Scott Horsley reports that is more than three times the number of jobs added the month before.

"Today's jobs report shows the USA economy continues to create jobs at a strong pace even as we enter the longest period of economic expansion on record", said Tony Bedikian, head of global markets at Citizens Bank.

The unemployment rate ticked up to 3.7 percent in June from 3.6 percent for the previous two months, reflecting an influx of people seeking jobs who were initially counted as unemployed.

The largest employment gains came in health care and professional and business services, although manufacturing turned in a robust 17,000 jobs after four months of little change - a surprise turnaround for an industry that has been flagging with higher raw material costs due to tariffs and the downturn of world trade.

Average hourly earnings rose six cents or 0.2% in June after gaining 0.3% in May.

The unemployment rate rise reflects an increase in the number of Americans entering the labor force-from 176,000 in May to 335,000 in June. If we had a Fed that would lower interest rates, we'd be like a rocket ship. As a result, many analyst were thoroughly convinced that the Federal Reserve would act to stimulate the economy by cutting interest rates at its next meeting at the end of this month.

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But, President Trump said that the economy would, but "we don't have a Fed that knows what they're doing". The only problem with this reasoning is that it amounts to saying stocks need a weaker economy to prosper.

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Both the countries have imposed additional tariffs on billions of dollars' worth of their exports to each other. Gao said the Chinese and U.S. teams are in close contact for resuming trade talks but gave no time-frame.

The stock market opened lower as investors contemplated what the report might mean for expectations that the Fed will be cutting interest rates later this month in an effort to stave off a widely expected economic slowdown through the year. The Fed in its semi-annual report to Congress on Friday repeated its pledge to "act as appropriate" to sustain economic growth.

There is evidence that real wages are also growing when taking inflation into account.

In conjunction with June's payroll data, the BLS revised May employment numbers down from positive 75,000 to 72,000, while the April number was also lowered from 224,000 to 216,000. Overall, the economy continues to grow and is likely to set the record for longest expansion, but poor leadership and policy remain significant risks. The average work-week in June held steady at 34.4 hours.

The Dow fell more than 150 points early Friday after the government's report. These sectors added 24,000 jobs during June and 158,000 in total over the year-to-date.

Lack of solid progress in resolving an acrimonious trade war between the United States and China was additionally seen forcing the US central bank's hand, no matter a powerful employment report from the Labor Department on Friday.

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