US Economy Adds A Whopping 287,000 Jobs
WASHINGTON (CBSNewYork/AP) -- Employers shook off two months of weak hiring by adding 287,000 jobs in June, a robust pace that suggests a resilient U.S. economy recovering from a slump early in the year.
The hiring spurt marked a sharp improvement from May's dismal showing, when just 11,000 jobs were added. A modest 144,000 jobs had been added in April.
The unemployment rate rose in June to 4.9 percent from 4.7 percent. The uptick occurred for mostly positive reasons: more Americans began seeking work, a sign of growing confidence in their job prospects even though many had not yet found employment.
The broadly positive report suggests that the U.S. economy was improving before the United Kingdom startled the world late last month by voting to leave the European Union. That "Brexit" vote roiled financial markets and raised fears that it could slow the global economy in the coming months. The solid jobs figures raise hopes that the U.S. economy, which has repeatedly shrugged off overseas headwinds in past years, may be able to keep growing even as the rest of the world stumbles.
Average hourly pay, a chronic weak spot in the seven-year recovery from the Great Recession, ticked up in June, the latest sign wages are creeping higher. In the past 12 months, they have risen 2.6 percent, the best year-over-year reading since December. That is still below traditionally healthy growth of about 3.5 percent.
There were other signs of an improving job market: The number of people working part-time, but who would prefer full-time work, fell sharply, reversing a large increase in May.
Hiring was widespread, in both higher and lower-paying sectors. Manufacturers added 14,000 jobs, the most since January. Professional and business services, which includes accountants, engineers and architects, as well as temporary workers, gained 38,000. Retailers added nearly 30,000 new workers, and health care gained more than 58,000.
Even with June's big gain, job growth has slowed this year. Employers added an average of 147,000 jobs a month in the April-June quarter. That's down from 196,000 in March and 230,000 last year.
The recent hiring slump had come after the economy grew at a tepid 1.1 percent annual rate in the first three months of the year. Americans' spending rose at the slowest pace in two years during that time - a significant drag given that consumer spending drives around 70 percent of the economy.
Concerns about the global economy have deepened since the U.K.'s Brexit vote. The yield on the 10-year U.S. Treasury note this week touched a record low of 1.34 percent. Such a decline has historically signaled anemic growth and even an outright recession. When investors fear for the future and seek safe returns for their money, they typically shift into Treasurys. That flow of money forces down yields.
The hiring slowdown caught Federal Reserve officials off guard. They cited the weak jobs figures during their June meeting as a key reason for putting off any further rate increases.
That sentiment signaled a shift from their April meeting, when many Fed policymakers had indicated that they were prepared to raise rates as soon as June if the job market and the economy continued to improve.
Most recent economic data had pointed to an improvement from the sluggish start to the year, though all of it pre-dated the Brexit vote. Americans, for example, ramped up their spending in April and May, and measures of consumer confidence also grew. The stronger spending led economists to forecast that annualized growth rebounded to 2 percent or more in the April-June quarter.
Manufacturing companies expanded in June at their fastest pace since November, according to a survey by the Institute for Supply Management, a trade group. Services companies, including retailers and banks, also grew at a faster pace in June, the ISM found.
And home sales have marched upward this year despite a low supply of houses for sale. Sales of existing homes reached a nine-year high in May.
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