US job market looks solid 8 years after recession ended
- Author: Zachary Reyes Jun 15, 2017,
Jun 15, 2017, 16:43
But manufacturers, retailers and governments shed workers last month. The April figure declined from an originally reported 211,000 to 174,000.
Market analysts widely expected the Fed to raise rate this month on the solid job market data. "The economy is still growing but the job market has lost some momentum". Factories reduced their payrolls by 1,000 in May after adding 11,000 net new jobs the previous month.
Economists surveyed by CNNMoney predict the USA added 179,000 jobs in May and that the unemployment rate remained at 4.4%, its lowest level in a decade. Last month's decline came as people left the labour force. Employment at all levels of government fell by 9,000 last month.
According to Reuters, minutes of the Fed's May policy meeting, published the week before, showed while policymakers agreed they should hold off hiking rates until there was evidence the slowdown in overall economic growth this year was temporary, most agreed "it would soon be appropriate" to raise borrowing costs.
Job growth slowed sharply in May to just 138,000, the Labor Department said Friday, an unexpectedly lackluster figure that could give Federal Reserve officials concern about enacting another interest rate hike this month. For the near term, we believe that today's report does not meet the high bar required for the Fed to stand pat on the fed funds rate at its meeting later this month. Most of the growth is in support activities. Manufacturing payrolls fell by 1,000.
The Atlanta Fed is forecasting GDP increasing at a 4.0 percent pace in the second quarter. The data suggest employers are starting to add to payrolls more slowly in a tight labor market.
Average hourly earnings for private-sector workers increased by 0.2 percent from a month earlier in May.
That would keep the year-on-year increase in wages at 2.5 percent.
The tepid average hourly earnings reading comes as annual inflation rates have retreated in recent months.
Still, the jobs report produces several different measures of unemployment.
The U.S. central bank said "most" districts had cited worker shortages across a broadening range of occupations and regions.
"The hiring for very specific skilled and highly skilled workers is at an all-time high right now", he said, noting that vehicle production has reached record levels. Since February, the first jobs report with President Trump in office for the whole month, the USA has gained 594,000 jobs. The broadest gauge includes not only the officially unemployed but also part-time workers who would prefer full-time jobs and people who want a job but aren't actively looking for one and so aren't counted as unemployed. Other experts said the numbers from may can be erratic and are always revised later. "That's forcing them to increase compensation to stay competitive and hire temporary workers, but they are still having a hard time increasing prices to absorb the additional costs".