The U.S. economy has steered back on track after an abysmal May jobs report. Analysts expected the economy to add just 175,000 jobs, according to CNBC, yet the Bureau of Labor Statistics pegged new employment totals at 287,000 for the month of June.
Economy looking strong
Brexit seemed to have little effect on job gains in the U.S., as they jumped to the highest reported total since October 2015. Economists around the country breathed a sigh of relief after a less-than-stellar May total, which was trimmed down to just 11,000 new jobs in the most recent report, had spelled doom and gloom for the future.
"The economy added 287,000 jobs in June, a bounce-back from May's low number and a clear indication that the economy continues to make solid progress," White House Council of Economic Advisers Chairman Jason Furman said in a statement.
The unemployment rate increased 0.2 percent to a total of 4.9 percent, though the hike shouldn't be regarded as disconcerting. Contemporary economic thought suggests that 5 percent unemployment is the natural level of unemployment for any one country, and that, in the long run, fluctuations in unemployment rate will gradually normalize to this figure.
Hourly earnings growth continues to lag in light of a seemingly healthy economy - a major point of contention among many economic analysts. Average hourly wage now sits at $25.61, according to CNBC.
"In the financial job market, we have seen increased demand from candidates on desired wages," remarks Bryan Mulhern, Division Director for Beacon Hill's Financial Division in Philadelphia. "In many instances, employers will make concessions and pay higher salaries for the employees they want. This connotes an appropriate unemployment level, as employers must find ways to lure hesitant job-switchers into making a change. That being said, there clearly remains concern of near-term instability, as candidates have become far more focused on company stability and personal income level as opposed to longer term factors, such as career growth opportunity."
The Federal Reserve opted not to raise interest rates, and with the international economy now mired in political turmoil from multiple regions, it seems unlikely that a hike will come anytime soon.
Industries keep growing
Federal Reserve Chair Janet Yellen warned in a statement against taking too much stock from just one month's jobs report. While that rings true for the anomalous low of last month, the dramatic uptick this month should also be recognized as one of many data points. It is likely that these fluctuations will smooth out as the summer draws to a close.
Leisure and hospitality employment rose 59,000 in June, totaling the highest gain among all sectors. The BLS noted that average job gains for leisure and hospitality have totaled 27,000 a month, down from 37,000 per month last year.
Health care and social assistance came in a close second, with 58,000 new jobs added to the economy. Child day care saw a spike of 15,000 new jobs, likely due to the start of the summer.
The information industry added 44,000 new jobs, and telecommunications led the way with 28,000. This can be attributed to the end of the Verizon workers' strike. The mobile picture and sound record market stabilized this month by adding the same amount of jobs it lost in May.
"Even though we see fluctuations from month to month, the demand for IT contractors and employees remains pretty constant in this area," says Laura Snyder, Senior Business Development Manager for Beacon Hill's Technologies Division in Cleveland. "The challenge a lot of our clients have is finding enough qualified candidates to meet their needs. Combine this with the fact that, historically, we have seen more hiring in the second half of the year, we remain optimistic that the demand will stay strong."
Retail made a comeback with 30,000 new employees, and general merchandise led the way providing 9,000 of them, according to the BLS.
Lastly, the financial activities sector added 16,000 workers, and the BLS reported this brings the total to 163,000 half-way through 2016.
"In the finance and accounting disciplines, we have seen a steady level of hiring throughout 2016," states Mr. Mulhern. "There has definitely been increased activity as we get deeper into the year, but overall hiring levels have been extremely strong."
The most recent jobs report is a strong sign that the economy continues to grow, even with the presidential election looming overhead. Those scared off by the dismal May jobs report can now breathe a sigh of relief as the economy is back in full-swing.
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