June jobs report: 287,000 jobs added, unemployment up to 4.9%

Earlier today, the Bureau of Labor Statistics released the June jobs report. The toplines of 287,000 jobs added and a 0.2-percentage point uptick in the unemployment rate to 4.9%, both seasonally adjusted, were a mixed bag. The number of jobs added, even with an artifical approximate 35,000 “additions” from the return of striking Verizon workers, easily topped expectations of 175,000-180,000 jobs added, while unemployment went up slightly more than expected.

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Unfortunately, this report came with a significant downward revision to May’s reported job additions, which was revised from 38,000 jobs added in May (including approximately 35,000 “subtractions” from the aforementioned striking Verizon workers, which would have made the number 72,000) to just 11,000 jobs added (or 46,000 if one counts the then-striking Verizon workers). Put another way, over the past 2 months, there were 298,000 jobs added, or 149,000 jobs per month.

Virtually all of the job gains in June were in the service sector, with manufacturing seeing only 14,000 new jobs, construction seeing no new jobs, and mining and logging shedding 5,000 jobs. Outside of the strike-affected telecommunications sector, the sectors contributing at least 10,000 new jobs were bars and restaurants (21,900 jobs added), temporary help services (15,200 jobs added), hospitals (15,000 jobs added), child day-care services (14,500 jobs added), performing arts and spectator sports (14,000 jobs added), food manufacturing (13,000 jobs added), and amusements/gambling/recreation (11,400 jobs added).

On the unemployment side, the Associated Press tried to put a happy face on things, but they didn’t include any actual numbers. While 414,000 people did enter the workforce to push the labor force participation rate up to 62.7% from 62.6% in May, only a net 67,000 of them found work. The employment-population ratio actually fell by a rounded 0.1 percentage point (0.026 point unrounded) to 59.6%. Taken beyond the rounding to the nearest tenth of a point, the LFPR is the second-lowest of the year and the employment-population ratio is the lowest of the year.

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Of note, unlike the establishment survey, which subtracted the striking Verizon workers in May and added them back in in June when they returned to work, the household survey that measures unemployment counts those not working due to labor-management disputes, like the Verizon workers, as “employed”.

This continues a trend of weak employment growth from the beginning of the year. On a not-seasonally-adjusted basis, the +0.93 percentage-point gain in the employment-population ratio between January and June is the 7th-weakest since 1983, ahead of only, in worsening order, 2007, 2011, 2003, 2008, 2001 and 2009.

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Jazz Shaw 9:20 AM | April 19, 2024
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