WASHINGTON– The US unemployment rate rose to 4.1% in June, while job creation slowed from the previous month but was above market expectations, official data showed on Friday.
Overall, 206,000 jobs were created in June, compared with 218,000 the previous month (revised downward), the Labor Department report said.
The unemployment rate was expected to remain stable at 4%, with job creation expected to be lower at 185,000, according to market consensus compiled by specialist site Briefing.com, which noted that the labour market is still resilient.
The Department’s report highlights a slowdown in services, when the manufacturing sector has been in contraction for two years.
“We have more work to do, but wages are growing faster than prices and more Americans are joining the workforce,” US President Joe Biden said in a statement following the publication of the report.
The employment indicator, however, has not translated into any optimistic sentiment among Americans about the state of the economy. On the contrary, Americans are now paying twice or even three times as much for the same products as they did under President Donald Trump, who is seeking a second term in the White House in November.
For now, the figures point to a “gradual cooling” of the market, ZipRecruiter chief economist Julia Pollak told AFP.
Pollak, however, cited signs of weakness, including downward revisions to the April and May hiring figures for a cumulative total of 111,000.
Mike Fratantoni, chief economist at the American Mortgage Bankers Association, noted that more than a third of the new jobs were generated by the government sector. “Other aspects of the report indicate that there is a slowdown in the labor market,” he added.
Although there is still a long way to go, these indicators could give the US Federal Reserve (Fed, central bank) some confidence to slightly reduce its benchmark interest rates, after keeping them at their highest level in the last 22 years.
Source: With information from AFP.
