The Bureau of Labor Statistics reported Friday that the U.S. economy generated 213,000 seasonally adjusted new jobs in June. Of the total, 11,000 jobs were in the public sector, 202,000 in the private sector. The headline unemployment rate rose to 4.0 percent. A broader measure—which gauges both unemployment and underemployment—rose from 7.6 percent to 7.8 percent.
The latest gains marked the 93rd consecutive month of overall job growth. Each month’s jobs gains or losses are calculated by analyzing the Current Employment Survey of 147,000 business establishments. The unemployment rate is calculated from a different report, the Current Population Survey of 60,000 households.
As it always does, the bureau revised its calculations for the two previous months, taking into account data unavailable when reports for those months were originally released. April’s job gains were revised from 159,000 to 175,000; May’s gains from 223,000 to 244,000.
Many economists and pundits call the current situation a “booming” or “bustling” economy, and many indicators besides job growth are showing a still-strengthening economy at the beginning of the 10th year of the recovery from the Great Recession. But wages once again made only modest gains in June. This is a long-standing problem.
In fact, last month, the BLS reported that year-over-year, from May 2017 through May 2018, average “real”—that is, inflation-adjusted—hourly wages for the largest cohort of U.S. workers fell by 0.1 percent. That cohort comprises “production and non-supervisory” workers, and it makes up about 80 percent of the privately employed U.S. workforce. The cohort’s average real hourly May-to-May wages fell from $22.62 to $22.59. While their wages rose 2.8 percent during that period, inflation went up 2.9 percent. Rising gasoline prices were a big part of that rise.
Jeff Stein and Andrew Van Dam at The Washington Post reported last month:
“This is odd and remarkable,” said Steven Kyle, an economist at Cornell University. “You would not normally see this kind of thing unless there were some kind of external shock, like a bad hurricane season, but we haven't had that.”
The falling wages promise to exacerbate historic levels of U.S. inequality. Within the labor force, it means workers who were already making less are falling further behind. And if private laborers as a whole are seeing their earnings flatten while the economy as a whole grows at an annual rate of more than 2 percent, that means the gains are going almost exclusively to people already at the top of the economic ladder, economists say.
And Patricia Cohen at The New York Times reported:
To retain workers as well as attract new ones, employers say they are increasing pay, sweetening benefits packages and trying to create an appealing work culture.
Yet workers, particularly in lower-wage sectors, have complaints of their own — particularly about the slow pace of pay increases. Many employers limit hours to avoid paying benefits like health insurance. Work shifts frequently change with little notice, and wage increases are still insufficient to cover living costs. Stability and security are often scarce.
The Great Recession ended nine years ago last month, according to the National Bureau of Economic Research, which operates as the accepted arbiter of when recessions begin and end. But while the economy began its recovery that month in 2009, it didn’t mean that most out-of-work Americans began then to recover from the acute impacts of that recession. Joblessness remained high for several years, and large numbers of people gave up and left the workforce altogether. Millions of others scrambled to find jobs, but before they found employment gobbled up their savings, saw their homes foreclosed or were evicted from apartments because they couldn’t keep up with the rent, delayed entering college, and watched as their families came apart because of financial hardship.
Many workers are still feeling some of the negative impacts of the Great Recession even though the job market has markedly improved. Today’s BLS statistics showed that weak wage growth is very much still with us, with the average hourly pay for private production and non-supervisory workers in the non-farm economy rising in June just 4 cents an hour to $22.62.
Here are some more details from the June jobs report:
Unemployment rates differ by race and sex. [Percentages in brackets are for May]. Adult men: 3.7 percent [3.5]; Adult women: 3.7 percent [3.5]; Whites: 3.5 percent [3.5] ; Blacks: 6.5 percent [5.9]; Asians: 3.2 percent [2.1]; Hispanics: 4.6 percent [4.9]; American Indians: (not counted monthly).
U3 is the BLS label for its headline rate of unemployment. In addition, the bureau calculates a rate it labels U6. This scrutinizes “labor underutilitization” and covers both unemployment and underemployment. In June, as noted above, U6 rose to 7.8 percent. Its low shortly before the Great Recession began was 8 percent in March 2007. However, in mid-2001, it reached its lowest point ever: 6.9 percent. The U6 count covers a number of categories, one of those being part-time workers who want full-time positions but cannot get them.
The civilian workforce rose by 601,000 in June after rising 12,000 in May and falling 236,000 in April. The labor force participation rose to 62.9 percent in June, and the employment-population ratio remained unchanged at 60.4 percent.
Additional details from the May report:
• Average hourly earnings of private-sector production and nonsupervisory employees rose 4 cents an hour to $22.62.
• Average work week for all employees on non-farm payroll remained unchanged at 34.5 hours in June.
• Average hourly earnings for all employees on private non-farm payrolls rose 5 cents an hour to $26.98.
• The manufacturing work week in June rose 0.1 hour to 40.9 hours.
June Job Gains and Losses for selected categories:
- Professional services: 50,000
- Temporary help services: 9,300
- Transportation & warehousing: 15,400
- Financial activities: 8,000
- Leisure & hospitality: 25,000
- Information: 0
- Education and health services: 54,000
- Health care & social assistance: 34,700
- Retail trade: -21,600
- Construction: 13,000
- Manufacturing: 36,000
- Mining and Logging: 4,000
Here's what the seasonally adjusted job growth numbers have looked like in the previous decade compared with this June’s gain of 213,000 jobs.
June 2008: -154,000
June 2009: -469,000
June 2010: -140,000
June 2011: 234,000
June 2012: 68,000
June 2013: 158,000
June 2014: 306,000
June 2015: 191,000
June 2016: 285,000
June 2017: 239,000