June Jobs Report

U.S. employers have added 12.2 million jobs since employment touched a recent low in February 2010. June marks the 57th consecutive month of job gains, the longest stretch on record. So far this year, employers have added an average 208,000 jobs a month, down from last year’s monthly average of 260,000, the highest level since 1999. Hiring slowed in the early months of the year, and though job growth bounced back, updated figures show it was weaker in April and May than previously estimated.

Average hourly earnings of private-sector workers were unchanged in June, at $24.95. Over the past year, wages have risen 2%, in line with the average during much of the expansion. Wage growth has been tepid throughout much of the recovery and stagnant wages have been a mystery, given the sharp decline in unemployment. Economists are watching closely for a sustained pickup in wages, which would suggest the U.S. economy is nearing “full” employment nearly six years after the recession.

The labor-force participation rate—or the share of working-age Americans with jobs or searching—fell to 62.6% from May’s 62.9%. That’s the lowest level since October 1977, in part reflecting the numbers of discouraged workers who have given up on finding permanent employment. The labor force declined by 432,000 workers last month, after increasing by 397,000 in May.

The size of the labor force typically swells in June as a wave of high school and college grads join the workforce. The labor force grew much more slowly this year. White House economists note that’s partly because households reported their work status a bit earlier than normal last month, and thus captured a smaller fraction of workers who likely started looking for jobs.

The headline unemployment rate checked in at 5.3% in June, down from 5.5% in May. It was the lowest rate since April 2008, but it was for the wrong reasons–more people stopped looking for work last month. A broader measure of unemployment that includes Americans stuck in part-time jobs or too discouraged to look for work fell to 10.5%. That’s still higher than it typically would be during this phase of an expansion.

Private employers added 223,000 jobs in June, while government employment was unchanged. The mining sector, which includes many oil industry jobs, lost 4,000 jobs last month, and has shed 71,000 jobs this year. Health-care employment increased by 40,000 in June, while retailers added 33,000 workers and financial services jobs grew by 20,000. Jobs in construction were unchanged.