U.S. employers added 206,000 jobs in June as hiring held steady despite persistent inflation and high interest rates.
But the employment picture was mixed at best as job gains for April and May were revised down by a hefty 111,000 and the private sector added a disappointing 136,000 jobs.
Also, the unemployment rate, which is calculated from a separate survey of households, rose from 4% to 4.1%, highest since November 2021, the Labor Department said Friday.
Economists surveyed by Bloomberg had estimated that 195,000 jobs were added last month, so job creation modestly beat estimates.
But the job market in the spring was decidedly less buoyant that believed. Payroll gains were revised down from 165,000 to 108,000 in April and from 272,000 to 218,000 in May.
Are wages falling or rising?
And average hourly pay rose 10 cents to $35, pushing down the yearly increase to 3.9%, the lowest since June 2021.
Wage growth generally has slowed as pandemic-related worker shortages have eased, but it’s still above the 3.5% pace that’s in line with the Federal Reserve’s 2% inflation goal.
Many Americans, meanwhile, have more purchasing power because typical pay increases have outpaced inflation the past year.
How is the job market doing right now?
So far this year, the job market largely has shrugged off high interest rates and softening but still elevated inflation, with payroll growth averaging well over 200,000 a month.
But forecasters expect a gradual slowdown by the end of 2024 as high borrowing costs and prices take a bigger toll on consumer and business demand. Low- and middle-income households are struggling with near-record credit card debt and historically high delinquencies, contributing to a recent pullback in retail sales. And their pandemic-related savings have mostly run dry.
In May, job openings ticked up to 8.1 million, the Labor Department said this week. That’s still above the pre-pandemic level of about 7 million but below the record 12.2 million in March 2022 during severe COVID-induced labor shortages and the job-hopping frenzy known as the Great Resignation.
Hiring has dipped below pre-pandemic levels.
Although job growth has been remarkably resilient, that’s chiefly because employers have been reluctant to lay off workers following the labor crunches. Jobless claims, though, have edged higher in recent weeks, and economists expect layoffs to pick up by year’s end as average job growth downshifts to just over 100,000.
Meanwhile, unauthorized immigration, which also has boosted job growth by expanding the supply of available workers, has slowed since March, Morgan Stanley wrote in a research note. That too could curtail job growth, especially in industries such as construction, restaurants and hotels, the research firm says.
This article originally appeared on USA TODAY: June jobs report: 206,000 jobs added last month
