USA unemployment rate rises unexpectedly to 4.0% | 6 July 2018

10 July, 2018, 02:13 | Author: Regina Lloyd
  • Economy adds 213K jobs in June unemployment ticks up to 4 percent

After revisions, job gains averaged 211,000 over the past three months, as the job market was approaching full employment. The Contingent Workers Survey released two months ago showed that the claim that gig economy jobs were replacing traditional employment was a myth.

It's the longest streak on record.

With a record 6.7 million unfilled jobs in April, economists are optimistic that wage growth will accelerate later this year.

Automakers added 12,000 jobs in June, but adverse trade developments could deflate the gain. But the average was skewed downward in June because the job seekers were mainly those with only a high school education or less, who are generally paid lower wages, Barrera noted. The agency says more people were seeking job opportunities and that forced the rate up to 6%. Manufacturers added another 36,000 jobs last month on top of the 19,000 created in May. Instead of accelerating, as many had hoped, annual wage growth fell slightly, to 2.7 percent from 2.8 percent.

The report also says average hourly wage growth, which is closely watched by the Bank of Canada, remained strong last month at 3.6 - although it did come down from its nine-year high in May of 3.9 per cent.

Many experts have expected job gains to slow because the low employment rate is making it harder for firms to find workers. At more than 1.141 million people employed in the industry in June, the legal jobs figures edged outside of a range that has prevailed since December 2016.




The economy continues to show many signs of strength despite the brewing trade war.

The ranks of unemployed people seeking jobs jumped by 499,000 in June, which caused the unemployment rate to rise from its previous 18 year-low.

U.S. President Donald Trump's administration began imposing tariffs on 25 percent on $34 billion in Chinese imports, which just recently took effect. So, taking this all together we have a United States economy growing at around 4% in the current quarter, that has an incredibly tight labour market with headline consumer price inflation potentially rising to 3% next week.

But there is a matter about which the Chairman of the Fed, Jerome Powell, is beginning to express concern, the threat from an escalating tariff "war".

In May, the unemployment rate was 3.755% when extended out three decimal places, though this was officially rounded up to 3.8%, matching the lowest unemployment rate since April 2000. The Federal Reserve on Thursday reported some businesses had already scaled back or postponed planned investment due to the trade struggles, and warned that many more promise to do more if the spats continue to escalate.

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