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Friday, March 29, 2024

June Mehployment Report

Courtesy of Joshua Brown, The Reformed Broker

Much ado about not much. Labor Force Participation Rate falls again, 400,000 people basically dropped out, maybe forever, but the unemployment rate hits a low not seen since the spring of 2008.

Average hourly earnings were subdued, possibly putting the FOMC on pause. Or not. I’m increasingly convinced they plan to flip a coin in September. The new FOMC dot plot below:

dot plot

Labor force participation is now at its lowest level since I was born in 1977. This is because – I don’t know if you know this – there are a lot of boomers in America that have been retiring lately, something demographers could never have seen coming for the last forty years. Also, traditional manufacturing, clerking, phone-answering and repair jobs are increasingly being carried out via software and robotics. That’s not going to change. Bureau of Labor officials pointed out that “At least we’re not f***ing Greece.”

Some details via Bloomberg:

The addition of 223,000 jobs followed a 254,000 increase in the prior month that was less than previously estimated, a Labor Department report showed Thursday in Washington. The jobless rate fell to a seven-year low of 5.3 percent as more people left the labor force.

The median forecast in a Bloomberg survey called for a 233,000 advance.

Average hourly earnings at private employers held at $24.95. They increased just 2 percent over the 12 months ended in June, following a 2.3 percent gain the prior month.

The participation rate, which indicates the share of the working-age people in the labor force, decreased to 62.6 percent, the lowest since October 1977, from 62.9 percent.

This is all “on-trend” data and the trend remains weakly strong. Or strongly weak, depending on whether you’re reading this in Canada or not.

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