US Economy Adds 209,000 Jobs in June, Missing Wall Street Estimates
The US economy added 209,000 jobs in June, falling short of Wall Street’s estimates and indicating a slowdown from the previous month, according to data from the Bureau of Labor Statistics. Economists surveyed by Bloomberg had expected 225,000 nonfarm payroll jobs to be added in June. This report marks the first time in 15 months that nonfarm payrolls have come in lower than expected by Wall Street.
Additionally, updated data revealed that 306,000 jobs were created in May, about 33,000 fewer than previously reported. Despite missing expectations, the June unemployment rate decreased from 3.7% in May to 3.6%, aligning with economists’ expectations.
Here are the key numbers compared to the Wall Street estimates:
– Nonfarm payrolls: +209,000 vs. +225,000
– Unemployment rate: 3.6% vs. 3.6%
– Average hourly earnings, month-on-month: +0.4% vs. +0.3%
– Average hourly earnings, year-on-year: +4.4% vs. +4.2%
– Average weekly hours worked: +34.4 vs. +34.3
Investors have closely watched the jobs data for indications of the Federal Reserve’s next moves in its campaign to raise interest rates to curb inflation. The market widely expects an interest rate hike at the Federal Reserve’s next meeting, which begins on July 25. Following strong economic releases on Thursday and the jobs report on Friday, futures tied to the Federal Reserve’s benchmark interest rate now project a 95% chance of a rate increase at the July meeting, according to the CME FedWatch Tool.
In other findings, April’s job gains were also revised lower, from 294,000 to 217,000, reducing job growth over the two-month period by 110,000 from previous reports.
The report also highlights job growth in specific industries. The government sector saw the largest increase, adding 60,000 jobs. In healthcare, 41,000 jobs were added, while construction gained 23,000 jobs. Professional and business services added 21,000 jobs. Although employment in leisure hospitality experienced a slight increase of 21,000, it still remains below pre-pandemic levels. On the other hand, retail trade employment, which includes furniture, home furnishings, electronics, and appliance retailers, declined by 11,000 in June.
The disappointing job growth for June indicates a potential shift in the US economy’s momentum. As the Federal Reserve gears up for its next meeting, the decision to raise interest rates becomes more likely. Investors and economists will closely monitor future economic indicators to gauge the state of the economy and make informed investment decisions.
This article was written by Josh, a reporter for Yahoo Finance.
Sources: Reuters, Yahoo Finance