Jobs Numbers: U.S. Adds 213,000 in June 2018

Roman Schwartz
July 7, 2018

It was the same scenario in the United States, where the economy added 213,000 jobs last month but the unemployment rate rose to 4 per cent from 3.8 per cent because of growth in the labour force.

The manufacturing sector helped power the gains, adding 36,000 jobs, but the retail sector shed 22,000 positions.

The Canadian economy gained 32,000 jobs in June, but the unemployment rate rose to six per cent from 5.8 per cent because of increase in the labour force. That kept the annual increase in average hourly earnings at 2.7 per cent.

On the negative side, the unemployment rate for black workers increased 0.6 percentage points to 6.5 percent from the record low hit in May. On Thursday, Trump floated the prospect of imposing tariffs on more than $500 billion in Chinese imports.

The June jobs is out and it's a beat. But for now the sector, which accounts for about 12 per cent of the US economy, appears in good health.

The big story in Friday's report, however, was the increase in labor force participation, which rose from 62.7% in May to 62.9% in June. But retailers cut 21,600 jobs last month, after boosting payrolls by 25,100 in May. And as executives say they can not find enough qualified workers, many are turning to hiring people who are now incarcerated or people with disabilities.

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Manufacturers and services firms have said in recent surveys that their business is improving despite anxiety about the tariff showdown.

The previous record was 4.8% back in 1973. In the chart below, we show two versions of the unemployment rate.

Yet the tax cuts have done little to generate substantial pay growth.

The economy also faces a substantial threat from the Trump administration's trade war with China and from other, ongoing trade disputes with USA allies, including Canada and Europe.

Following the report, USA stock turned positive after having been in red figures ahead of the report. Restaurants added 16,400 jobs in June, under the average of 18,400 over the year.

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