The US labor market cooled off in June, adding just 209,000 jobs
Minneapolis (CNN) — The US job market cooled back down in June, adding just 209,000 jobs, the Bureau of Labor Statistics reported Friday.
June’s total was nearly 100,000 jobs below May’s unexpectedly strong showing of 306,000 and below economists’ expectations for a net gain of 225,000 jobs.
It’s the lowest monthly gain since a decline in December 2020, and — excluding the losses seen during the first year of the pandemic — June’s total is the smallest since December 2019.
The unemployment rate ticked down to 3.6% from 3.7% the month before, according to the report.
US employers have now added jobs for 30 consecutive months.
“In the tug of war between the labor market and the economy, there is still a push and pull, yet the labor market remains strong,” Becky Frankiewicz, president and chief commercial officer of ManpowerGroup, said in commentary issued Friday.
A long, slow cooldown
While the Federal Reserve has tried to cool the economy with 10 consecutive rate hikes, the labor market initially remained impervious to those efforts — especially when nearly half a million jobs were added in January.
Service industries have driven much of the job growth in recent months as sectors such as leisure and hospitality sought to claw back from the deep job losses delivered by the pandemic as well as respond to a surge in consumer spending.
However, since January, the pace of monthly job gains has cooled considerably from what was seen during the past two years, and employment growth has tailed off somewhat in leisure and hospitality. That being said, last month’s job growth still outpaces the pre-pandemic average.
In June, industries such as government and health care saw the biggest job gains.
Fed officials have been hoping their aggressive rate-hiking campaign would bring about a slowdown in the job market, and especially in wage gains, which are viewed as a contributor to inflation.
Friday’s report showed that average hourly earnings growth was unchanged at 0.4% from the month before and also unchanged at 4.4% year-over-year.
In June, the labor force participation rate was unchanged for the fourth consecutive month at 62.6%.