US Job Growth Slows Sharply in June With Only 57,000 Jobs Added, Missing Expectations
The U.S. economy added just 57,000 jobs in June, significantly below the 115,000 expected, marking the weakest hiring in four months and raising concerns about labor market stability as wage growth continues to lag inflation.
The Report
Nonfarm payrolls for June increased by a seasonally adjusted 57,000 for the month, slower than the downwardly revised 129,000 added in May and worse than the 115,000 Dow Jones consensus forecast. The U.S. economy added just 57,000 jobs in June, a worrying sign for labor market stability as wage growth tracked below inflation for a third consecutive month.
Labor Market Softening
In June, average hourly earnings increased by 3.5%, which remains far below the most recent inflation reading of 4.2%, while the unemployment rate ticked down to 4.2% from 4.3%. However, the apparent improvement masks deeper weakness. The move lower was largely due to a slump in the labor force participation rate, which dropped 0.3 percentage point to 61.5%, the lowest since March 2021, with household employment plummeting during the month as 507,000 fewer people reported at work.
Prior Month Revisions
The report also included sharp downward revisions for prior months: hiring in April was cut by 31,000 jobs, and May was revised down by 43,000. Prior months saw significant downward revisions — the May total, which had been much stronger than economists had anticipated, was cut by 43,000, while April's figure came down 31,000 to 148,000 as the report showed labor market growth significantly slower than previously thought.
Sectoral Weakness
Another troubling sign flagged by the bureau was that hiring in the health care sector slowed to just 22,000 jobs, slower than its 38,000 monthly average over the last year. Leisure and hospitality reported a loss of 61,000 jobs, which the BLS said reflected slower-than-usual seasonal hiring.