The nation added 288,000 jobs in June, with non-farm payrolls strengthening much more than had been anticipated. Indeed, the consensus expectation for the month had been for job growth of about 215,000. Moreover, payroll data for April and May were revised upward. Specifically, it is now estimated that the nation added 304,000 jobs in April; earlier, that figure had been given as 282,000. And in May, the estimated payroll increase was revised upward from 217,000 to 224,000. Thus far in 2014, the economy has gained an average of 231,000 jobs a month. That is almost 20% better than the 2013 pace of 194,000.
At the same time, the unemployment rate, which is calculated from a separate survey, fell from 6.3% to 6.1%. Expectations had been for a reading of 6.3% for last month. All told, the number of unemployed persons fell by 325,000 in the latest month to 9.5 million.
The strong jobs report suggests that the economy is continuing to gain momentum, after slipping and sliding earlier this year under pressure from an unrelenting and severe winter that not only delayed economic activity but drove up costs for both businesses and consumers.
Meanwhile, the better job numbers could encourage the Federal Reserve to raise short-term interest rates, now near zero, earlier and faster than has been expected. As of now, we look for the central bank to begin its long-awaited tightening efforts sometime next year. Of course, one month does not make a long-term pattern. But there has definitively been a trend higher of late on the employment front.
As to other aspects of the report, the government also noted that the average workweek had held steady during the month at 34.5 hours, while wages had ticked up slightly, going from $24.39 an hour to $24.45. The job gains also were widespread, encompassing the professional and business services groups, retail trade, food services, and health care.
Also, the number of long-term unemployed (that is, those jobless for 27 weeks, or longer) fell by 293,000 in June to 3.1 million. These individuals accounted for 32.8% of the unemployed. Finally, the civilian labor force participation rate was 62.8% for the third consecutive month. That relatively low level, plus the fact that the number of persons employed part time--because they cannot get full-time employment--increased last month, were the lone disquieting aspects of this report.
At the time of this article's writing, the author did not have positions in any of the companies mentioned.