U.S. job growth strong; unemployment rate rises to 4 percent

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The labour force expanded by 75,600 in June, the biggest one-month increase in six years, Statistics Canada reported Friday from Ottawa. "There were some people who weren't participating in the labor force who are now being encouraged to return, so I'm not concerned about the uptick in unemployment", said Catherine Barrera, chief economist of the online job site ZipRecruiter. This was most due to a 1 percentage point rise in the unemployment rate for black women, although their EPOP also rose by 0.6 percentage points.

Steady hiring and low unemployment shows the labor market continues to be an area of strength for the economy since the recession ended nine years ago. "But enjoy the good news in the June report", Holtz-Eakin said. The drop in yields is making the U.S. Dollar a less attractive investment.

May's job gains were also revised up to 244,000 from 223,000, and job gains have now averaged 211,000 per month over the last three months. Traders said the report was more encouraging than discouraging in the wake of an escalating trade war between the USA and China.

The economy needs to create roughly 120,000 jobs per month to keep up with growth in the working-age population. And as is the case in most months, professional and business services as well as education and health services were the sectors that saw the largest increase in employment, with 50,000 and 54,000 jobs added in these sectors respectively.

From Table B-3, average hourly earnings were +2.7% year over year in June economy-wide, while average weekly earnings were +3.0%.

Looking further into the report, the unemployment rate rose to 4 percent after holding steady at 3.8 percent, its lowest level since 1969.

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The bottom line is that the buoyancy in June's US labor market statistics will reaffirm the Federal Reserve's view that the economy is doing super-well at present and that further interest rate hikes will be justified. The agency says more people were seeking job opportunities and that forced the rate up to 6%.

BNN Bloomberg Commentator looks under the hood of the latest Canadian jobs report and explains how the underlying data reveals a less rosy picture for the economy than the headline numbers.

Job openings are at record highs, meaning numerous job seekers are likely to find employment soon.

Construction payrolls rose by 13,000 last month after increasing by 29,000 jobs in May. Hourly wages for private, non-farm jobs in the USA increased by five cents to $26.98 per hour, according to the preliminary BLS data issued Friday.

The average workweek for all employees on private nonfarm payrolls was unchanged at 34.5 hours in June.

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