U.S. job market adds nearly 300,000, jobless rate rises to 4.9%

The U.S. labor market added nearly 300,000 new jobs in June, easing concerns that U.S. hiring levels were slowing after only 38,000 workers found new jobs in the previous month, the U.S. Bureau of Labor Statistics reported Friday (July 8).

Total nonfarm payroll employment increased by 287,000 in June as employers and the unemployment rate rose to 4.9%, up from 4.7% in May, BLS reported. Over the past three months, job gains have average about 147,000 per month.

Nationwide, U.S. employers added workers in leisure and hospitality, health care and social assistance, and financial activities. Employment also increased in information, largely reflecting the return of thousands of Verizon workers following a strike earlier this year, labor officials said.

Despite the lower jobless rate, the June labor market situation paints a brighter picture than last month when the fewest number of new workers were added to U.S. nonfarm payrolls in 2016.

The monthly unemployment survey also backs up a bevy of optimistic employment reports this week showing that the nation’s job market continues to remain one of the bright spots in unsure economic times. For example, global outplacement consulting firm Challenger, Gray & Christmas reported on Thursday that although employers announced plans to cut payrolls by 38,536 jobs in June, that figure is well below the 12-month average and indicative of a “positive employment environment.”

The Labor Department on Thursday also reported that jobless claims fell by 16,000 to 254,000, another sign more workers are leaving unemployment rolls as the number of unemployed persons increased by 347,000 to 7.8 million.

“These increases largely offset declines in May and brought both measures back in line with levels that had prevailed from August 2015 to April,” BLS officials said in the monthly jobless report.

Also on Friday, the CBIZ Small Business Employment Index (SBEI), a barometer for hiring trends that surveys labor data from more than 4,000 companies employing 300 or fewer people, revealed a 0.9% month-over-month increase in small business hiring in June. This reading marks the fifth consecutive month of employment gains for the Index and follows a 0.2% percent month-over-month rise in employee headcounts in May.

“June’s reading is positive news for the labor market and for the domestic economy in general. While Brexit rattled global markets, it has not yet had an impact on hiring trends for domestic small businesses,” says Philip Noftsinger, president of CBIZ Employee Services Organization.

Among the major worker groups, the unemployment rates for adult women (4.5%) and whites (4.4 percent) rose in June. The rates for adult men (4.5%), teenagers (16%), Blacks (8.6%), Asians (3.5%), and Hispanics (5.8%) showed little or no change.

The number of persons unemployed less than 5 weeks increased by 211,000 in June, following a decrease in the prior month. At 2 million, the number of long-term unemployed (those jobless for 27 weeks or more) changed little in June and accounted for 25.8% of the unemployed.

As the U.S. summer vacation season picked up momentum ahead of the Fourth of July, leisure and hospitality added 59,000 jobs in June, following little employment change in the prior month. Still, job gains in leisure and hospitality have averaged 27,000 per month thus far this year, down from an average of 37,000 in 2015, reflecting slower job growth in food services and drinking places.

Health care and social assistance added 58,000 jobs in June. Health care employment increased by 39,000 over the month, while job gains occurred in ambulatory health care services (+19,000) and hospitals (+15,000), about in line with average monthly gains over the prior 12 months in each industry. Child day care services also added 15,000 jobs in June.

Employment in financial activities rose by 16,000 in June and has risen by 163,000 over the year. The information industry also saw an increase of 44,000 in June, largely reflecting return of striking workers in the telecom sector and new jobs in motion picture and sound recording business.

The professional and business services continued its upward trend in June, adding a strong 38,000 new jobs in the month. Thus far this year, the industry has added an average of 30,000 jobs per month, compared with an average monthly gain of 52,000 in 2015.

Hiring in retail trade edged up by 30,000 in June, after changing little over the prior 2 months. Retail trade has added 313,000 jobs over the year.

In the negative column, employment in mining continued to trend down in June with a loss of 6,000 position nationwide. Since reaching a peak in September 2014, mining has lost 211,000 jobs. Employment in other major industries, including construction, manufacturing, wholesale trade, transportation and warehousing, and government, showed little or no change for the month.

Average hourly earnings in June for all employees on private nonfarm payrolls edged up two cents to $25.61, following a six-cent increase in May. Over the year, average hourly earnings have risen by 2.6%t. Average hourly earnings of private-sector production and nonsupervisory employees increased by four cents to $21.51 in June.

Arkansas workforce officials are expected to release Arkansas’ June jobless report on July 22.