US hiring beats expectations in June despite tariff worries
Job growth came in at 147,000 in June, rising from a 144,000 figure in May – which was also revised upwards.
- The US economy added more jobs than expected in June while the unemployment rate edged down, government data showed on July 3, offering signs of continued labour market strength despite worries over President Donald Trump's tariffs.
Job growth came in at 147,000 in June, rising from a 144,000 figure in May – which was also revised upwards – said the Department of Labour.
The unemployment rate ticked down from 4.2 per cent to 4.1 per cent, and wage gains decelerated to 0.2 per cent, the report added.
The world's biggest economy has fared relatively well since the Covid-19 pandemic, with a resilient job market allowing consumers to keep spending.
But Mr Trump's sweeping tariffs on US trading partners, including steep rates
on imports of steel, aluminium and autos, have dragged on consumer sentiment and fuelled business uncertainty.
That uncertainty has been accentuated by the US leader's approach of unveiling, then adjusting or halting measures – causing firms to become cautious in investments.
With a further wave of tariff hikes potentially incoming next week, analysts are monitoring for fragility in the job market and signs that companies might pull back in hiring and expansion.
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A consensus forecast by Briefing.com had expected overall job growth of 120,000.
In June, the state government and health care sectors added jobs while the federal government continued shedding roles, the Labour Department said July 3.
The federal government lost 7,000 jobs and employment is down by 69,000 since reaching a recent peak in January, the report added.
But salary growth appears to be cooling, from a 0.4 per cent month-on-month increase in May to 0.2 per cent in June.
From a year ago, wage gains were up 3.7 per cent, easing from the prior month as well.
But the figures will bring relief to observers worried after data from payroll firm ADP sparked alarm July 2, as it reported that the private sector unexpectedly shed jobs.
It is not uncommon for the ADP report to diverge from official figures, but analysts believe it can help understand the longer-term trajectory of the labor market.
ADP noted July 2 that although layoffs were rare, there remains a hesitancy to hire and replace departing workers.
For now, a solid labour market is likely to give the US central bank some room to hold interest rates steady for longer as policymakers observe the effects of Mr Trump's tariffs over the summer – and whether they will fuel broad inflation.
If the labour market weakened too quickly, the Federal Reserve could be inclined to lower rates sooner to boost the economy, even if inflation were not progressing downwards as swiftly as hoped. AFP
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