New reports show that June was a good month for jobs—with hiring up and layoffs decreasing.
- On Thursday, a report from the ADP Research Institute and Stanford Digital Economy Lab revealed that the U.S. economy added 497,000 new jobs in June.
- A separate study from hiring firm Challenger, Gray & Christmas Inc. revealed that job cuts hit an eight-month low last month, Bloomberg reports.
- On Friday, the U.S. Bureau of Labor Statistics (BLS) released its data for the month of June, showing 209,000 new jobs were added and that unemployment decreased from 3.7% in May to 3.6%.
- Its numbers came in below expectations of 225,000 expected jobs, but average hourly earnings increased by 0.4%, noting wages have increased by 4.4% in the past 12 months.
Why It’s Important
The news from ADP and BLS reveals an economy that is continuing to show signs of growth amid tight conditions and pressure. The Federal Reserve is holding interest rates between 5% to 5.25%, tightening an economy that saw high consumer confidence and improvement in the aftermath of the COVID-19 pandemic, but has since become overburdened with high inflation.
ADP and BLS’s data often showed differences in their conclusions on employment, with a nearly 272,000 figure discrepancy between both groups’ conclusions. However, both reflect an economy that is showing signs of improvement. It reflects an economy where average workers feel confident in their ability to find work as needed.
“Consumer-facing service industries had a strong June, aligning to push job creation higher than expected. But wage growth continues to ebb in these same industries, and hiring likely is cresting after a late-cycle surge,” says ADP chief economist Nela Richardson.
“The labor market remains too hot for the Fed’s comfort… With little chance that the supply of skilled labor will surge, the Fed will likely need to maintain its higher-for-longer rate posture into next year to suppress labor demand and sustainably rein in inflation,” says Bloomberg economist Stuart Paul.