logo
June jobs report expected to show hiring slowed while unemployment rate ticked higher

June jobs report expected to show hiring slowed while unemployment rate ticked higher

Yahoo4 days ago
The June jobs report is expected to show hiring slowed while the unemployment rate moved higher. The data's release will come as investors closely watch for any further signs of slowing in the US labor market amid growing debate over when the Federal Reserve will cut interest rates next.
Read more: How the Fed rate decision affects your bank accounts, loans, credit cards, and investments
The Bureau of Labor Statistics data is slated for release at 8:30 a.m. ET on Friday. Economists expect nonfarm payrolls to have risen by 110,000 in June and the unemployment rate to have moved up to 4.3%, according to consensus estimates compiled by Bloomberg.
In May, the US economy added 139,000 jobs. Meanwhile, the unemployment rate held flat at 4.2%.
Here are the numbers Wall Street is expecting Friday, according to data from Bloomberg:
Nonfarm payrolls: +110,000 vs. +139,000 in May
Unemployment rate: 4.3% vs. 4.2%
Average hourly earnings, month over month: +0.3% vs. +0.4%
Average hourly earnings, year over year: +3.8% vs. +3.9%
Average weekly hours worked: 34.3 vs. 34.3
"We think labor demand is slowing, but so far the slowdown is modest," Morgan Stanley chief US economist Michael Gapen wrote in a note to clients.
The release comes as signs of cooling in the job market have continued to emerge in recent data. On Wednesday, ADP data showed private employers unexpectedly cut 33,000 jobs in June. This marked the first month of job losses in the private sector since March 2023. Meanwhile, continuing filings for unemployment benefits recently hit their highest level in nearly four years.
But the data has yet to indicate a significant, broad-based slowdown in the labor market. On Tuesday, the May Job Openings and Labor Turnover Survey (JOLTS) showed job openings ended May at their highest level since November 2024. The release also showed the quits and hiring rates remaining near decade lows.
ADP chief economist Nela Richardson told Yahoo Finance during a call with reporters on Wednesday that it is now clear that hiring momentum has slowed in the US labor market. Still, that doesn't mean the second half of the year will bring "consistent job declines," in Richardson's view.
The June jobs report comes as the S&P 500 (^GSPC) has recently hit several new record highs amid investor optimism over Fed interest rate cuts and US trade deals. Weaker economic data in the past several weeks has pushed markets to price in two interest rate cuts from the Fed, compared to the one reduction investors priced in a month ago, per Bloomberg data.
But should Thursday's jobs report show clear signs of slowing in the US economy that would further boost rate cut bets, it could also be a downside catalyst for stocks, Citi head of US equity trading Stuart Kaiser wrote in a note to clients.
"Payrolls sub-100k or a [unemployment rate] that rounds to 4.4% would push stocks at least 1% lower, in our view," Kaiser wrote.
Josh Schafer is a reporter for Yahoo Finance. Follow him on X @_joshschafer.
Orange background

Try Our AI Features

Explore what Daily8 AI can do for you:

Comments

No comments yet...

Related Articles

10 reasons every American adult should invest in the stock market
10 reasons every American adult should invest in the stock market

USA Today

time28 minutes ago

  • USA Today

10 reasons every American adult should invest in the stock market

The stock market isn't just for rich investors. Jeremy Siegel, the Wharton School finance professor who wrote the classic investing book Stocks for the Long Run, famously called the stock market the "greatest wealth creator of all time" if those results are measured in decades instead of months or years. However, a recent Gallup survey found that only 62% of U.S. adults are currently invested in the stock market through individual stocks, mutual funds or retirement accounts. The ones who aren't invested might be shunning stocks due to a lack of cash, a low tolerance for risk, a distrust of Wall Street or poor financial literacy. So today, let's cut through all that confusion and discuss 10 reasons every American adult should be invested in the stock market — regardless of their income, savings or appetite for risk. 1. Savings accounts can't beat inflation From 2004 to 2024, the U.S. had an average annual inflation rate of 2.5%. During that same period, U.S. savings accounts paid an average annual yield of 1%. So if you had simply kept your cash in a savings account, your purchasing power would have steadily withered. The Federal Reserve's rate hikes in 2022 and 2023 boosted the yields of savings accounts, CDs and T-bills to between 3% and 5%, but those yields will shrivel again as interest rates drop. 2. Bonds don't always beat inflation Some bonds — like Treasury-Protected Inflation Securities (TIPS), Series I (inflation-tracking) bonds, and long-term Treasuries — are designed to keep pace with inflation. However, most Series EE (fixed-rate), municipal and corporate bonds struggle to stay ahead of that curve. Some of those bonds might outpace inflation over the short term with higher yields, but they usually come with a lot more credit risk than lower-yielding bonds. 3. The S&P 500 outpaces inflation Meanwhile, the S&P 500 — the index of the 500 leading publicly traded companies in the U.S. — delivered an average annual return of more than 10% since its inception in 1957. Past performance never guarantees future gains, but the S&P 500 should keep rising as long as the U.S. economy keeps expanding. So if you don't want to fret over individual stocks, you can directly invest in the S&P 500 through the low-cost Vanguard S&P 500 ETF (NYSEMKT: VOO). 4. It doesn't cost anything to get started In the past, investors were usually charged commissions for each trade. But over the past decade, commission-free trades — which were popularized by newer trading platforms like Robinhood Markets — became the industry standard. 5. Fractional trades make investing even simpler With some of the market's top stocks trading at hundreds or thousands of dollars per share, it seems like you need a lot of cash to get started. That was true in the past, but most brokerages now offer fractional trades — which allow you to gradually accumulate shares of high-flying stocks like Nvidia or Amazon. 6. Small investments add up over time If you'd invest $100 each month with a modest 8% annual return, you would compound your gains to over $150,000 in 30 years. Therefore, you don't necessarily need to set aside a lot of cash to thrive in the stock market — you just need to make consistent, bite-sized investments. 7. The top stocks aren't as volatile as you think There are plenty of risky and volatile stocks. But there are also plenty of evergreen stocks that pay predictable dividends and generate fairly stable long-term returns. For example, Coca-Cola's stock rallied 213% over the past 20 years — and if you had reinvested your dividends, you would have generated a total return of 473% and easily outpaced inflation. Warren Buffett's Berkshire Hathaway surged 786% during the same period. 8. It's a great way to gain a financial education The stock market might seem confusing, but it becomes clearer once you understand a company's business model, evaluate its earnings reports, and realize that it only requires simple arithmetic to calculate the stock's valuations. Once you grasp those basic metrics, it becomes easier to analyze stocks and understand the broader financial markets. Teaching yourself how to invest is a great way to increase your own financial literacy and make smarter decisions with money. 9. You should secure your retirement today Being smarter with money could help you retire earlier and more comfortably. But according to the Federal Reserve, only 54.3% of Americans have retirement accounts, and a mere 4.7% of those accounts have hit $1 million in savings. Building up a portfolio of stocks, index funds and exchange-traded funds could help you join that elite minority. 10. Passive income grants you more freedom Once you build up a $1 million portfolio, you can spread it across conservative dividend stocks that pay yields of 4% to 5% to generate $40,000 to $50,000 in extra income every year. If you don't need that cash right away, you can reinvest it into the same stocks to compound your gains. That's why stocks are still definitely one of the world's greatest wealth creators — and why every adult in the U.S. should have some exposure to the stock market in their retirement accounts. John Mackey, former CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool's board of directors. Leo Sun has positions in Amazon and Berkshire Hathaway. The Motley Fool has positions in and recommends Amazon, Berkshire Hathaway, Nvidia and Vanguard S&P 500 ETF. The Motley Fool has a disclosure policy. The Motley Fool is a USA TODAY content partner offering financial news, analysis and commentary designed to help people take control of their financial lives. Its content is produced independently of USA TODAY. The $23,760 Social Security bonus most retirees completely overlook Offer from the Motley Fool: If you're like most Americans, you're a few years (or more) behind on your retirement savings. But a handful of little-known "Social Security secrets"could help ensure a boost in your retirement income. One easy trick could pay you as much as $23,760 more... each year! Once you learn how to maximize your Social Security benefits, we think you could retire confidently with the peace of mind we're all after. JoinStock Advisorto learn more about these strategies. View the "Social Security secrets" »

America has two labor markets now
America has two labor markets now

Axios

time2 hours ago

  • Axios

America has two labor markets now

Americans live in separate economic realities: Those with a job are likely to stay employed, but those without one are likely to stay unemployed. Why it matters: Welcome to the low-hire, low-fire labor market. Private-sector layoffs are at historic lows, but that masks a dreadful outlook for unemployed workers or those unhappy with their current positions. Driving the news: The labor market surprised in June with a better-than-expected payroll gain of 147,000, the government said on Thursday. But a whopping 85% of those job gains came in just two sectors, according to calculations by Mike Konczal, a former Biden economic official: education and health care. Hiring in other sectors — including professional and business services, a catch-all category for white collar jobs — was little changed, the government said. The big picture: That continues the "frozen job market" trend that has plagued the economy in recent years. The trend is being exacerbated by the rise of AI, as employers experiment with how to make their workforces more productive. Separate data released this week showed the number of layoffs fell by 188,000 in May, hovering above multi-decade lows. But the number of people hired into new jobs also fell by 112,000, to a rate significantly below its pre-pandemic levels. The number of workers continuing to collect unemployment benefits is at the highest level since 2021, a sign that it is taking jobless workers longer to find a job. What they're saying: "We're in a complex jobs market —it's not falling apart but the lack of dynamism, the lack of churn and the lack of hiring has been punctuated in the first half of the year," says ADP chief economist Nela Richardson. "Many employers are loath to lay off workers until they see the whites of the eyes of a recession, having had such problems finding suitable workers in the first place," David Kelly, chief global strategist at J.P. Morgan Asset Management, wrote in a recent note. The bottom line: If you look only at how many Americans are losing their jobs, this appears to be a pretty terrific labor market. If you look only at how many are being hired for new jobs, it is the weakest in years.

Dollar Doubters Seed Historic Gains for Developing World Debt
Dollar Doubters Seed Historic Gains for Developing World Debt

Yahoo

time3 hours ago

  • Yahoo

Dollar Doubters Seed Historic Gains for Developing World Debt

(Bloomberg) -- US policy volatility has sent money managers scouring the world for alternatives, propelling local bonds from emerging-market countries to their best first half in 16 years. Foreign Buyers Swoop on Cape Town Homes, Pricing Out Locals Trump's Gilded Design Style May Be Gaudy. But Don't Call it 'Rococo.' Massachusetts to Follow NYC in Making Landlords Pay Broker Fees NYC Commutes Resume After Midtown Bus Terminal Crash Chaos What Gothenburg Got Out of Congestion Pricing The surge in demand for fixed-income assets in EM currencies is largely the flip side of sinking confidence in the US dollar, which has tumbled almost 11% this year. That's its worst performance since the 1970s, and the losses are across the board, with the greenback falling against 19 of the 23 most-traded emerging-market currencies, and by at least 10% against 10 of them. The upshot is that an index of emerging-market local debt has returned more than 12% in the first half of the year, according to data compiled by Bloomberg, beating hard-currency bonds, which were up 5.4% in the same period. The first-half gains were the strongest since at least 2009. 'I don't think anyone had this much dollar weakness on their bingo card,' said Edwin Gutierrez, head of emerging-market sovereign debt at Aberdeen Group Plc. 'We thought local-currency debt would outperform hard-currency, but not by the magnitude that it ended up.' The money is flowing in unprecedented amounts. EM-debt funds attracted more than $21 billion so far this year, Bank of America Corp. said on Wednesday, citing EPFR Global data. These funds drew inflows for each of the past 11 weeks and $3.1 billion in the week through July 2. More Rate Cuts Boosting the case further is the prospect of interest-rate cuts in developing countries, according to Lewis Jones, a debt manager at William Blair Investment Management in New York. 'We expect more capacity from emerging central banks to cut rates, and also the trend of a weaker dollar versus the euro to continue,' he said. 'For European investors it could look more attractive looking forward.' Latin American economies have handed investors some of their best returns, with Mexico's local bonds, known as Mbonos, generating a gain of 22%, while some of Brazil's government bonds have returned more than 29%. The Brazilian notes bounced following a sharp selloff late last year, while traders piled into bets that policymakers are done with their hiking cycle. 'We remain invested in Mexican bonos, the trade is not over for us,' said Adriana Cristea, senior investment manager at Pictet Asset Management, adding that the firm has positions in local bonds across emerging markets regions, from Latin America to EMEA and Asia. Improving economic fundamentals in some emerging markets may also bring new issuers to the market. Ghana, Africa's top gold producer, is planning to resume domestic bond sales later in 2025 after short-term borrowing costs fell to the lowest in three years. Easing tensions between Israel and Iran also boost the investment case for local debt from the developing world. Despite the rally, Aberdeen's Gutierrez isn't yet looking to take profits on positions in EM local debt. He said his main overweights are Colombia, the Philippines and South Africa. More broadly, investors favor Brazil, South Africa and Turkey, BofA's head of global emerging markets fixed-income strategy David Hauner wrote in a note on July 3 based on feedback from clients. 'It will be a multi-year process' of rethinking US exposure, said Brad Godfrey, co-head of emerging markets debt at Morgan Stanley Investment Management, who helps oversee $20.6 billion. 'It will be a relearning process for some people that hadn't been exposed to local in a while.' What to Watch US to publish initial jobless claims data FOMC meeting minutes Hungary will release fiscal figures through June Peru, Egypt, Romania, South Korea, Israel, Malaysia central banks hold its monetary policy decision --With assistance from Selcuk Gokoluk and Srinivasan Sivabalan. For Brazil's Criminals, Coffee Beans Are the Target SNAP Cuts in Big Tax Bill Will Hit a Lot of Trump Voters Too Sperm Freezing Is a New Hot Market for Startups Pistachios Are Everywhere Right Now, Not Just in Dubai Chocolate China's Homegrown Jewelry Superstar ©2025 Bloomberg L.P. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data

DOWNLOAD THE APP

Get Started Now: Download the App

Ready to dive into a world of global content with local flavor? Download Daily8 app today from your preferred app store and start exploring.
app-storeplay-store