Strong but slowing labor market gained 206,000 jobs in June
(CN) — The U.S. job market went on summer vacation in June, adding just 206,000 jobs, according to data published by the Bureau of Labor Statistics on Friday, representing the year's second-slowest month of growth.
The slow but steady labor market coincided with a slight increase in pay. The average worker now makes $35 an hour, adding up to a 10-cent raise, or about three-tenths of a percent more compared to May. Production and nonsupervisory jobs made similar gains in pay, averaging $30.05 an hour.
In April 2020 during the Covid-19 pandemic, U.S. unemployment peaked at a sudden and staggering 14.8% but has steadily decreased since, averaging 4% monthly over the last three years. Unemployment increased one-tenth of a percentage point to 4.1% between May and June, reflecting the 6.8 million people out of work. Unemployment bottomed out at 3.4% in April 2023 and has since slowly crept up.
Comparing unemployment levels today to pre-pandemic rates in 2019, Elise Gould, senior economist for the Economic Policy Institute, highlighted decreases in joblessness among Black Americans and young adults. Gould wrote in a statement that she sees “a strong (but decidedly not overheated) labor market” rather than a weakening one.
Over the last month, joblessness increased among adult women and decreased slightly for adult men and teenagers. Unemployment for Asian Americans increased in June but remained steady across other groups.
About 22% of out-of-work Americans, or 1.5 million people, have been without work for 27 weeks or more. An estimated 166,000 people joined the group of long-term unemployed in June, which has grown by 400,000 people since this time last year.
An additional 5.2 million people who wanted a job were not counted in the formal unemployment rate because they had not actively sought a job in the last month. About 28% of Americans out of the labor market looked for work in the last year and about 7% “believed that no jobs were available to them.”
June’s new hires entered several vital sectors including health care, social assistance, construction and the government.
Public sector jobs accounted for 70,000 hires in June, well above the 49,000 monthly average. Education jobs made up an additional 34,000 hires while state governments gained 26,000 workers.
With 34,000 new workers in social assistance and 27,000 in construction, both sectors added above-average numbers to their workforces last month. The health care market saw a below-average 49,000 new workers, including 22,000 ambulatory workers and 22,000 hospital staff.
Retailers and professional services marked the biggest declines in June, with a combined loss of 26,000.
In a recent report, analysts for the U.S. Chamber of Commerce recalibrated the :Great Resignation" in professional and business services jobs as the "Great Reshuffling," finding that many workers who quit their jobs didn’t necessarily quit the workforce.
“While quit rates remain high, hiring rates continue to outpace them as many workers have been transitioning to other jobs in search of an improved work-life balance and flexibility, increased compensation, or a strong company culture,” wrote Stephanie Ferguson, a director of employment policy at the U.S. Chamber of Commerce.
Both in 2019 and now, Ferguson said, employers have struggled to fill in-person and low-paying jobs.