Coverage: Unemployment rises to 4 percent, more jobs added
The U.S. economy added 213,000 jobs in June, more than expected, while the unemployment rate jumped to 4 percent, according to the jobs report released from the Bureau of Labor Statistics on Friday.
Akin Oyedele of Business Insider had the news:
It was a record 93rd straight month that US employers hired more people than they fired.
Economists had forecast that employers added 195,000 payrolls last month, according to the median estimate compiled by Bloomberg. They expected that unemployment rate held steady at 3.8%, the lowest level since 2000 and 1969 before then.
The unemployment rate increased because more people were looking for jobs. The labor-force participation rate increased to 62.9% from 62.7%.
Wage growth slowed. Average hourly earnings increased by 0.2% month-on-month and 2.7% year-on-year, slower than economists had forecasts. An acceleration of this rate would have shown that employers were indeed paying up for the skilled workers who they say are in decreasing supply. According to a report Thursday from the HR-software provider ADP, business’ “number one problem is finding qualified workers.”
Patricia Cohen of the New York Times reported that some employers are having trouble finding workers:
As the jobless rate falls, employers’ complaints about their inability to find qualified, reliable workers mount.
“There’s more jobs than there are people available for jobs — at every level,” said Joe Galvin, chief research officer of Vistage, an association of small-business owners and executives. In a Vistage survey last month, an overwhelming share of employers spoke of their frustration in finding people to fill openings on the factory floor and in the executive suite, Mr. Galvin said.
To retain workers as well as attract new ones, employers say they are increasing pay, sweetening benefits packages and trying to create an appealing work culture.
Yet workers, particularly in lower-wage sectors, have complaints of their own — particularly about the slow pace of pay increases. Many employers limit hours to avoid paying benefits like health insurance. Work shifts frequently change with little notice, and wage increases are still insufficient to cover living costs. Stability and security are often scarce.
Katia Dmitrieva of Bloomberg News reported that manufacturing job growth had its best month since December:
The details across industries showed continued strength in goods-producing jobs: Manufacturing added 36,000 to payrolls, the best month since December, including a 12,000 increase in the auto industry, the most since August. That’s consistent with other reports showing strength in factory activity.
Service providers boosted payrolls by 149,000, led by a 54,000 gain in education and health services, and 50,000 in professional and business services. The retail industry’s woes were also reflected in employment, as vendors cut 21,600 positions, the biggest drop since December. That followed a 25,100 gain in May.
Several measures showed that the labor market still has slack to absorb.
The number of employed people in the workforce rose by 102,000, while the number of unemployed jumped by 499,000, suggesting more people entered the labor force and actively sought jobs. The participation rate, or share of working-age people in the labor force, increased to 62.9 percent from 62.7 percent the prior month.
The participation rate remains a closely-watched measure for central bankers. While improving prospects for employment and wages are helping attract people from the sidelines of the job market, the retirements of older workers are among factors that have been exerting downward pressure on participation.