U.S. employers added 57,000 jobs in June – less than half the number of jobs added in May – and the unemployment rate dipped to 4.2% as the labor force shrank, according to data released Thursday by the U.S. Bureau of Labor Statistics.
Employment continued to trend upward in professional and business services (+36,000), social assistance (+25,000) and healthcare (+22,000). Leisure and hospitality lost jobs (-61,000), reflecting weaker than usual seasonal hiring.
There was no significant change over the month in other major industries, including construction; manufacturing; wholesale trade; retail trade; transportation and warehousing; information; financial activities; other services; and government.
Overall U.S. job growth in June (+57,000) was slower than it was in May (+129,000) and April (+148,000). The unemployment rate was 0.1 percentage point lower in June than it was in April and May (4.3%) as more people left the labor force. There were 720,000 fewer people in the labor force (employed or looking for work) in June than in May.
The labor force participation rate, which measures the percentage of the working-age population that is either working or looking for work, fell 0.3 percentage points from 61.8% in May to 61.5% in June, the lowest since March 2021.
In June, average hourly earnings for all employees on private payrolls rose by 13 cents, or 0.3%, to $37.64. Over the year, average hourly earnings have increased by 3.5%.
The government on Thursday also revised its previously reported preliminary data for April and May. The U.S. job numbers for April were revised down by -31,000, from +179,000 to +148,000, and the change for May was revised down by -43,000, from +172,000 to +129,000. With these revisions, employment in April and May combined is 74,000 lower than previously reported.
State-level jobs data for June is expected to be released later this month. New Jersey’s unemployment rate for May was 4.7%, down 0.1 percentage point from April’s rate of 4.8%.
Stocks were up Thursday morning after the release of the June data pointing to slower than expected job growth. Investors seemed to view the softer labor market as lessening the chance that the Federal Reserve will increase interest rates at its next meeting on July 29.
According to the CME Group FedWatch tracking too, a week ago investors put the odds of an interest rate increase at 32.1%. After the jobs report was released Thursday, investors put the probability of a rate hike at 19.8%.
