June saw the U.S. economy add just 57,000 new jobs, falling well short of economists’ expectations, even as the national unemployment rate retreated slightly to 4.2%.
According to the latest report from the Bureau of Labor Statistics released Thursday, nonfarm payroll growth last month came in significantly below preliminary forecasts of more than 100,000 jobs.
The employment sectors that saw the biggest gains in hiring in June included professional and business services (+36,000), social assistance (+25,000), and health care (+22,000).
Meanwhile, leisure and hospitality suffered the greatest reversal in June, shedding 61,000 jobs after a major surge in May, due to what the federal reporting agency called “weaker than usual seasonal hiring.”
Employment showed little or no change over the month in other major sectors, including mining, construction, transportation and warehousing, financial activities, and government services.
Although the unemployment rate dipped to 4.2%, down from 4.3% in May, this was largely due to a decline in the labor participation rate, which measures the share of working-age people who are employed or seeking work.
The labor participation rate dropped to 61.5% in June, down by 0.3 percentage points from the prior month.
Average hourly earnings rose 3.5% year over year in June, edging up from 3.4% the previous month.
Realtor.com® senior economist Jake Krimmel says today’s jobs readout will do nothing to push the Federal Reserve under new Chair Kevin Warsh off its rate-cut pause, nor will it increase the likelihood of future reductions.
“There’s no sign of a two-sided threat to the dual mandate serious enough to force the FOMC’s hand, and Chairman Warsh seems focused far more on inflation than employment anyway,” says Krimmel. “Right now, inflation outranks labor in the Fed’s calculus; don’t expect anything in [this] jobs report to change that.”
This is a developing story. Please check back for updates.
Snejana Farberov is a reporter at Realtor.com covering the U.S. housing market and the latest domestic real estate trends. She has worked as a general assignment journalist in New York City and Long Island for 16 years, writing for New York Post, Daily Mail, and News 12. Snejana earned bachelor’s degrees in journalism and Italian from St. John’s University, followed by a master’s degree from Columbia University School of Journalism.
