US economy adds more jobs than expected in June


Full-time employment was up by 9,100 By sector, employment in goods producing industries was up by 46,600, the highest since April 2012, led by construction and manufacturing Service producing industries lost 14,700 jobs during the month Self-employment was up by 22,000, with employment in the public sector rising by 11,800. But in Friday's revised figures, BLS reports that the legal services industry actually gained 300 jobs in May, compared with April.

The US economy keeps adding jobs at a blistering pace. The unemployment rate edged up to 4 percent, but this was due to a reported surge of 601,000 people entering the labor force.

The employment increase last month beat economist expectations for a 20,000 gain and was the second highest so far in a year where job creation has been sluggish.

Wages were being carefully watched by economists for signs of inflationary pressures building in the economy, with average hourly earnings forecast to have risen 0.3% over last month in June and 2.8% over the same month a year ago.

But that is good news for the Federal Reserve since they will not feel pressure to raise interest rates faster. In spite of healthy job growth, wage growth is especially weak in manufacturing, rising just 1.7 percent over the a year ago.

Unemployment rate rises for an encouraging reason: workers are confident they can find a new job in today's economy.

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In general, monthly payroll gains of around 100,000 - or even a bit less - are sufficient to keep pushing down the unemployment rate, according to economists. They had expected that the unemployment rate held steady at 3.8%, its lowest level since 2000. On the same day as the release of June's jobs report, the USA and China are imposing duties on more than $30 billion-worth of each other's goods. The United States is now in a trade war with all its top five trading partners: China, Canada, Mexico, the European Union and Japan.

It also boosted the USA stock indexes, which are expected to reap weekly gains on Friday after 14 days of losses.

Economists expect the manufacturing sector to bear the brunt of the tit-for-tat tariffs, through a slowdown in hiring and capital expenditure. Restaurants added 16,400 jobs in June, under the average of 18,400 over the year.

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

A long run of impressive monthly job creation is among the main reasons why the projections of economists, in both the private and public sectors, have continued to be bullish for USA growth, despite growing uncertainty about the rest of the global economy and the threat of a trade war.

Other big job creators are Empire Outlets, being built on the St. George waterfront, and the Staten Island Mall, which recently added 242,000-square-feet to its footprint. That followed an increase of 5,000 jobs in May.