From Market Insider
- The US Bureau of Labor Statistics on Thursday said the US added 4.8 million jobs in June. That exceeded the 3 million payroll additions expected by economists surveyed by Bloomberg.
- It marks the second straight month of job additions as the economy tries to claw back from a coronavirus-induced recession. The US saw record job losses in April.
- The BLS also said the US unemployment rate was 11.1% in June, down from 13.3% in May.
The US economy notched its second straight month of job additions in June amid nationwide efforts to claw back from a coronavirus-induced recession.
American businesses added 4.8 million nonfarm payrolls during the month, according to the Bureau of Labor Statistics. That exceeded the 3 million payroll additions expected by economists surveyed by Bloomberg.
The US unemployment rate came in at 11.1%, the BLS said, lower than the 12.5% expected by economists. It was also down from 13.3% in May. April’s 14.7% reading was the highest since the Great Depression of the 1930s.
“Today’s positive jobs report does provide a powerful signal of how swiftly US job growth can bounce back and how rapidly businesses can reopen once the nation finally brings the coronavirus under control — a reason for optimism in coming months,” said Andrew Chamberlain, the chief economist at Glassdoor.
The data reflected US efforts to move forward with reopening plans in the first half of the month. Still, in the past two weeks not covered by the report, rising new coronavirus cases have cast doubt on the path of the recovery.
As many as 19 states and cities have paused or rolled back reopening efforts as they grapple with surges in COVID-19 cases. Economists and industry watchers will have to wait for the July report, due in August, to see the employment impact of these new coronavirus cases.
“There’s continued risk that a second-wave could reverse some of these job gains in July, but that should not take away from the strength of the June data,” Thomas Simons of Jefferies said.
The BLS said it fixed an issue that affected the data from prior months by misclassifying people as employed when they should’ve been designated as unemployed. The error was seen undercounting the unemployment rate by roughly 1 percentage point.
Nearly all sectors of the economy added jobs in June, with the 2.1 million payrolls added in leisure and hospitality representing the biggest gain. Within the industry, employment in food services and drinking places accounted for 1.5 million jobs added. Still, overall employment in the sector is down by 3.1 million since February.
Retail trade also added 740,000 jobs in the month, nearly double its gains in May. Education and health services, manufacturing, and professional and businesses services also added jobs in June. Still, employment in all sectors remains below February levels.
Andy Kiersz / Business Insider
Both the labor-force participation rate and the employment-to-population ratio increased in June, suggesting that people indeed returned to work as states reopened from pandemic-related lockdowns.
Still, while the unemployment rate declined, permanent job losers continued to rise in June, adding 588,000 to 2.9 million after increasing in May. At the same time, reentrants to the labor force rose by 711,00 to 2.4 million.
The June numbers come after May’s report shocked economists, showing 2.5 million job additions at a time when they were expecting a contraction of 7.5 million jobs. The unemployment rate also declined from the prior month, bucking forecasts for a historically high figure.