U.S. Job Growth Rebounds in June

Following a disappointing May jobs report (that just so happened to be released the same day President Trump canceled planned tariffs on Mexico), it seems that the United States jobs market bounced back in June. This morning the Labor Department released its latest report showing that the economy added a better-than-expected 224,000 jobs. That’s nearly three times the 75,000 jobs added in the month prior. Additionally, despite the unemployment rate rising one-tenth of a point to 3.7%, it remained at a historically low level for the month.

According to MarketWatch, forecasts had predicted the June report would show a gain of 170,000 jobs — a figure the actual numbers easily surpassed. The strong performance is notable for several reasons, not the least of which is the fact that the report arrived just days after the U.S. economy officially set the record for the longest period of expansion. As mentioned the unemployment rate did increase slightly, however that’s because 300,000 workers reentered the labor force during the month. Meanwhile wages were up 6¢, bringing the average to $27.90 an hour. That increase kept the annualized wage growth rate steady at 3.1%.

Commenting on the impact of June’s report, Indeed Hiring Lab director of economic research Martha Gimbel told MarketWatch, “The jobs growth number this month is comforting after a few months of uncertainty. While job growth may be slowing down from its astonishing rate last year, it’s reassuring that the economy is still creating jobs at a reasonable pace.” Principal Global Investors chief global economist Bob Baur expressed similarly settled sentiment, explaining, “With May’s disappointing report behind us, those who have been watching for indications of any near-term economic slowdown should take note that neither job nor wage growth have slowed to a point of concern yet.”

While a strong jobs report is typically a good thing, the morning markets didn’t seem to appreciate the news. That’s because many investors had their hearts set on the Federal Reserve cutting interest rates later this month. However, with June’s figures assuaging some fears that the economy was softening, the Fed’s next move is now less obvious. Nevertheless the CME FedWatch Tool still pegs the odds of a rate cut at 100%, with a 96.1% chance of the new target rate falling to 2.00%-2.25%.

At a time when many Americans are bracing for a recession — or believe one has already begun — the Labor Department’s latest report would suggest that the country’s longest-ever expansion isn’t over yet. Of course that raises questions about what will happen with the Fed and bring much more speculation to what was a foregone conclusion only a few days ago. It also means we can expect President Trump to ramp up his attacks on Fed chairman Jerome Powell in the coming weeks as the agency mulls its decision. In other words, while fireworks are typically reserved for the Fourth, it seems they may get an encore throughout the rest of what’s sure to be an interesting July.

Author

Jonathan Dyer

I'm a small town guy living in Los Angeles looking to make solid financial decisions. I write for a number of finance websites, including HuffingtonPost and Business2Community. I founded DyerNews.com in 2015 to focus on personal finance and the emerging FinTech markets.

Other Articles by Jonathan Dyer

Nitra Latest FinTech to Join Visa's Fast Track Program

A spending insights platform built for healthcare professionals is getting a big boost by joining up with a major card company. This week, Nitra announced that it was the latest startup to join Visa's Fast Track program. As a result, the company will now have access to Visa's global payment network, VisaNet Nitra is a FinTech offering spending management tools for private practice physicians. With the platform, clients can issue...

Stripe Raises $6.5 Billion, Now Valued at $50 Billion 

FinTech giant Stripe has just closed a massive funding round, but is once again cutting its valuation. The online payments company has announced that it's just raised $6.5 billion. The Series I included participation from returning investors Andreessen Horowitz, Baillie Gifford, Founders Fund, General Catalyst, MSD Partners, and Thrive Capital, while new investors GIC, Goldman Sachs Asset and Wealth Management, and Temasek also joined. Goldman Sachs served as sole placement...

Chase Reveals Q2 2023 5% Bonus Categories for Freedom Cards

One of the biggest perks of the popular Chase Freedom Flex card (and its predecessor the Chase Freedom card) is the ability to earn 5% cashback on categories that rotate each quarter. Currently, these categories include grocery stores, fitness clubs and gym memberships, and purchases at Target. Now, with the first quarter of the year drawing to an end, Chase has revealed its Q2 2023 bonus categories. From April 1st...