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08 July 2018, 05:56 | Kelvin Horton
US jobs growth stronger than expected
The U.S. economy surpassed expectations in June, adding more jobs than expected even as the unemployment rate rose slightly to 4 percent. The labor force participation rate rose by 0.2 percent to 62.9 percent in June, remaining below pre-2008 levels. In spite of healthy job growth, wage growth is especially weak in manufacturing, rising just 1.7 percent over the a year ago.
Canada received a dose of new jobs last month, maintained sturdy wage growth and saw more people searching for work - all seen as positives by experts who believe the path is clear for the central bank to raise interest rates next week.
"There's definitely still a lot of room for the labour market to absorb the slack", Kevin Hassett, chairman of the White House Council of Economic Advisers, said on Bloomberg Television.
On Friday, the world witnessed the imposition of new tariffs by the United States and China on goods worth $34bn from each of the two countries.
It also boosted the USA stock indexes, which are expected to reap weekly gains on Friday after 14 days of losses. The factory jobs were concentrated in the automobile sector, which had seen a decline in employment in May after a fire at a parts supplier disrupted production.
The Labor Department has said that apart from the additional 213,000 jobs in June, another 37,000 extra jobs were created in April and May, which was again more than the estimates.
What about tariffs? On Friday, the US formally imposed an additional $34 million in tariffs on China.
Michael Gapen, chief USA economist at Barclays Plc in NY and a former Fed official, said that the boost in workers coming into the labour market bodes well for pushing down the unemployment rate again.
Still, average hourly pay rose just 2.7 per cent in June from 12 months earlier, meaning that after adjusting for inflation, wages remain almost flat. The agency says more people were seeking job opportunities and that forced the rate up to 6%.
Last month, President Trump broke with long-standing practice and tweeted about the jobs report prior to its official 8:30 a.m. release, prompting markets to move. After unemployment dropped to 3.8 percent in May, sparking worries of labor shortages, over 700,000 women joined the labor force in June, thus cooling the job market. The low jobless rate has yet to force employers to offer higher wages in order to fill job openings. Manufacturing and professional and business services saw gains, with 36,000 and 50,000 jobs added, respectively. In May, the annual inflation rate rose to 2.8%, exceeding wage gains.
The average workweek for all employees on private nonfarm payrolls was unchanged at 34.5 hours in June.
One Civilian Fatality Reported In Klamathon Fire
The Klamathon Fire started on July 5 near Hornbook, California , a town 14 miles south of the OR border, according to KSBY . The blaze, which started Thursday and is spreading fast, is only 5% contained, according to fire officials.