Jul 6, 2018

U.S. job growth in June beats expectations

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Data: Bureau of Labor Statistics; Chart: Axios Visuals

The U.S. added 213,000 jobs last month and the unemployment rate rose to 4% as more people — especially new graduates — entered the labor force. Economists surveyed by Bloomberg forecast 195,000 new jobs and unemployment holding at 3.8%. The U.S. added 223,000 jobs in May.

Why this matters: As the NYT notes, this is the 93rd straight month of job creation — the longest streak on record.

What to watch: Will President Trump's escalating trade war begin to weigh on job growth?

Thought bubble: The 0.2% uptick in joblessness was notable, too. It was the largest rise in two years, and a blotch on a remarkable, several-year slide in unemployment. Analysts will be alert to what comes next given the possibility that the U.S. trade war with China and Europe could impact business investment, and new hiring going forward.

  • Mark Zandi, chief economist at Moody's Analytics, tells Axios that the tariffs war initiated by the U.S. at this point is too small to spook businesses, still basking in the Trump tax cut earlier this year along with higher government spending.
  • But, he adds, "if the trade war continues to escalate, then the economic pain will mount, and under some (still remote) scenarios, they could even undermine the expansion."
  • In minutes of its June meeting released yesterday, the Fed said its business contacts had signaled concern about the tariffs, and suggested there could be an impact on their decisions about future investment.

Wages continued to be flat, with a tepid 2.7% increase in average pay, as companies continued to stubbornly hold back labor costs in the tight market. But Jordan Cohen, vice president of marketing for Ladders, the site for jobs paying at least $100,000 a year, tells Axios that June was a big month for high-paying positions.

  • The number of jobs listed on the site rose above 212,000, the first time they have gone over 200,000 this year.

Instant analysis from the NYT:

And Bloomberg:

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