The economy added 372,000 jobs in June, which represents a hotter-than-expected boost to the labor market that may ease fears of an impending recession, but this also complicates the task of the Federal Reserve as it seeks to cool inflation.
The Labor Department reported Friday that the unemployment rate was 3.6 percent, the same month before.
The number is in line with average gains over the past few months, including 368,000 in April and 384,000 in May. Employers have continued to compete for workers in recent months, with initial jobless claims rising only marginally from their lowest level in March.
The private sector has now regained the epidemic number of jobs, while the public sector is still 664,000 fewer jobs than in February 2020. Unlike the public sector, No industry lost jobs in Juneon a seasonally adjusted basis.
There is no guarantee that rapid growth will continue indefinitely, however, as higher prices affect consumer spending. The workforce remains constrained by aging demographics, low levels of immigration and barriers to employment that keep many people on the sidelines.
“We weren’t going to sustain the employment growth we were seeing – it had to stop,” said Julian Richers, vice president of global economics research at Morgan Stanley. It will take some time, however, he said, to exhaust America’s willingness to act.
“There is still a lot of pent-up demand for workers,” Dr. Richers said. “It stands to reason that as the economy slows, employment should slow down as well, once we’ve been working through the backlog of labor demand.”
This accumulation is evident in 11.3 million jobs Which employers opened in May, a number that is still close to record levels and leaves nearly two jobs available for everyone looking for work. In this equation, any worker who is laid off because certain sectors are under stress is likely to find new jobs quickly – for some time at least.
But a number of headwinds create a time limit on the seller’s market for labour. Business leaders report that while domestic demand remains strong and some supply chain issues have eased, order backlogs are no longer growing and savings accounts are shrinking. Whenever possible, employers automate tasks instead of bringing in new employees.
“Employers are becoming less concerned about filling those vacancies as they watch the economy slow,” said Bill Adams, chief economist at Comerica Bank. “I would expect companies to likely walk slowly in filling vacancies before actually pulling open vacancies.”
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