The Bureau of Labor Statistics released its June Employment Situation report Friday.
After a surprisingly low increase of only 11,000 jobs (revised down from 38,000) in May, economists were perplexed in their predictions for the near-term outlook. Friday’s June labor market report, however, showed an increase of 287,000 jobs, which beat consensus of 180,000 and showed the U.S. jobs data returning to normal levels.
The unemployment rate for the month increased to 4.9% which was above its previous 4.7% and a little higher than the consensus estimate at 4.9%. The positive report makes a central bank rate increase more likely with the U.S. economy’s total profile more in line with overall scenarios prior to the Brexit vote.
The market opened higher on Friday with a positive expectation for the labor market and continued trading higher throughout the day. The day’s report appears to support the bullish sentiment in trading this week, and the report is also likely to be a catalyst to push stocks to new highs in the weeks ahead. On Friday, the following stocks led gains at midday in the Dow Jones Industrial Average.
- Caterpillar (CAT, Financial) 2.93%.
- American Express (AXP, Financial) 2.81%.
- DuPont (DD, Financial) 2.49%.
- Goldman Sachs (GS, Financial) 2.47%.
- Boeing (BA, Financial) 2.31%.
The two distinct surveys on which the Employment Situation reports showed the improvements in the labor market occurring in June. The household survey data, which gives a profile of the U.S. labor market overall, showed the total number of employed workers in the U.S. at 151.1 million. The employment-to-population ratio was 59.6%. In June, the number of unemployed workers increased by 347,000 to a total of 7.8 million. For the month, the household survey calculations reported an unemployment rate of 4.9% for June.
The establishment survey data within the Employment Situation report showed the total number of jobs increasing in the private sector at 265,000, and the total number of jobs increasing in the public sector at 22,000.
In June, the establishment survey data showed the education and health services and leisure and hospitality industries leading in hiring for the month while construction, mining and logging and transportation and warehousing showed zero to negative payroll increases.
The June establishment data also showed some increases in earnings. Average weekly earnings increased 68 cents from May and $19.86 from June 2015. Average hourly earnings increased 2 cents from May and 65 cents from June 2015.
In CNBC reports Friday, market specialists gave their insights about the June jobs report.
Disclosure: I do not directly own any stocks included in this article.
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