US Employment Sector Recorded Additional 213,000 Jobs In June
More Job Openings In June
A government report released last week Friday indicated that the employment sector of the US economy experienced better days in June as it recorded additional 213,000 jobs, even though the unemployment rate increased to 4%.
In a survey conducted on a cross-section of economists, they revealed that the general expectation was for nonfarm payroll-gains of about 195,000 and stability of the unemployment rate at 3.8% which was the lowest it had been since 1969.
Sources claimed that the monthly job gains had little effect on wages as the average hourly earnings increased to 2.7%, a percentage rise slightly below the projected 2.8% increase.
The constant discussions about the economy nearing full employment have allegedly done nothing to affect hiring which has continued to grow at a substantial pace. The Bureau of Labor Statistics last month revised the April’s count to 175,000 from the prior 159,000 and upped the May count to 244,000 from the initially recorded 223,000 which made it about 37,000 higher than the initially reported figures.
Following the release of the government report, it was reported that the S&P maintained flatness, while the Doe recorded a lower opening. Further, the rise in the unemployment rate was pegged to be a result of an increase in the rate of labor participation which rose to 62.9% with about 0.2 percentage points. The rise was due to the re-entering of approximately 601,000 individuals into the workforce from the sidelines. There was also a recorded two-tenth increase to 7.8% in an employment measure which took into account discouraged workers and workers who worked part time for economic reasons.
Breakdown of Report
The rate for blacks which was previously at a record low of 5.9% also rose to 6.5%. The professional and business services sector ranked top with 50,000 new jobs and manufacturing came after the business industry with its additional 36,000 jobs record. The healthcare sector went up to 25,000 jobs, and construction sector recorded 13,000 jobs. The retail sector, however, reportedly, recorded a loss of 22,000 jobs.
Similarly, there was stability in the employment-to-population ratio which remained at 60.4% and made it the highest level recorded since January 2009. As stated by Steve Rick, a chief economist at CUNA Mutual Group, the employment report was a demonstration of the labor market’s strength. Rick added that June surpassed the record of May as it kept the increasing jobs at a steady rate while also addressing the worries of economists who were of the opinion that hiring was drawing nearer to a plateau state following the inconsistency recorded some few months before June.
The report came at a time when economists and analysts expressed hopes that the economy has begun to move to a higher level. There was a rise in the GDP with only 2% in the first quarter of 2018, but a common projection has been that it would increase by about 4% in the second quarter. While some economists are putting the expected gains at just 3.8%, the Federal Reserve policymakers are carefully observing the numbers.
Job Market Concerns
It would be recalled that the central bank already raised its benchmark interest rate two times since the year began and also added that there would be two more hikes before the year comes to an end. However, the minutes of the meeting released last week Friday from the June Federal Open Market Committee meeting raised specific job market concerns. The summary of the meeting pointed that the labor outlook was getting stronger, but there were also still concerns about businesses facing a hard time in getting qualified workers to take up the available jobs.
Further, it was stated at the meeting that some business owners who were facing the difficulty in getting qualified workers were beginning to increase salaries, introduce additional work benefits and retrain existing worker in a bid to retain their workers. However, some others have reportedly been automating their work processes rather than seeking out new workers. It was also a common belief among the employers that the wage pressure was at a moderate level and the government report released the day after stood as a confirmation of the Thursday’s minutes.
The employers expressed that they were expecting a wage hike to take place soon. Data from a recently conducted survey indicated that a major factor slowing down the increase in wages was the fact that the growth of jobs wasn’t particularly for full-time positions.
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