U.S. Employers Add 195,000 Jobs in June; Jobless Rate Stays at 7.6%

job seekers employment economy By Lucia Mutikani

WASHINGTON -- U.S. job growth increased more than expected in June, which could draw the Federal Reserve closer to implementing a plan to start scaling back its massive monetary stimulus later this year.

Employers added 195,000 new jobs to their payrolls last month, the Labor Department said Friday, while the unemployment rate held steady at 7.6 percent as more people entered the workforce.

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The government revised payrolls for April and May to show 70,000 more jobs created than previously reported.

Economists polled by Reuters had expected employment to increase 165,000 last month and the jobless rate to fall a tenth of a percentage point to 7.5 percent.

The closely watched employment report was released two weeks after Fed Chairman Ben Bernanke offered an upbeat assessment of the economy's outlook and said the U.S. central bank expected to start trimming its bond purchases later this year.

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The employment report also showed weekly hourly earnings rose by the most since November. That, combined with other relatively upbeat data on housing, auto sales and manufacturing, makes it more likely the Fed will proceed with its tapering plan in September.

The Fed is purchasing $85 billion in bonds each month in an effort to keep borrowing costs down and spur stronger growth.

Twenty-eight of 60 economists polled by Reuters in late June said they expect the Fed to begin dialing back its purchases in September, with most expecting the program to end by June 2014.

The majority also forecast the Fed initially would cut purchases by $20 billion a month.

The recent signals from Bernanke that a start date for reducing bond purchases is approaching triggered a global selloff in stock and bond markets, which have come to rely on the Fed as a steady source of demand for financial assets.

Interest rates on everything from U.S. Treasury debt to home mortgage loans moved sharply higher, threatening to curtail credit for consumers and businesses.

Workforce Participation Rises

The central bank is closely watching the unemployment rate. It has said it expects the jobless rate to drop to around 7 percent by the middle of next year, when it anticipates ending the bond purchases.

The jobless rate was unchanged last month because the labor force swelled - a sign of confidence in the jobs market.

The third consecutive month of increase in the workforce lifted the participation rate - the share of working-age Americans who either have a job or are looking for one - further away from a 34-year low touched in March.

Declining participation as older Americans retire and younger people give up the hunt for work in frustration has accounted for much of the drop in the unemployment rate from a peak of 10 percent in October 2009.

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The private sector accounted for all the job gains in June, with payrolls there increasing by 202,000 after rising 207,000 the prior month.

Government employment, in contrast, declined by 7,000 jobs after falling 12,000 in May. Economists, however, say the job losses are probably not due to the deep government spending cuts known as the sequester as most agencies are relying on furloughs.

Hiring in the health care and social assistance sector, increased 23,500 after slowing in May.

Consumer-related areas such as retail and wholesale trade showed further gains in employment in June, reflecting strengthening demand that was highlighted by a surge in automobile sales. Retail jobs increased 37,100 last month after advancing 26,900 in May.

Manufacturing payrolls fell by 6,000 jobs, declining for a fourth straight month. Construction employment rose 13,000 adding to May's 7,000 jobs as the housing recovery pushes ahead, but it remains constrained by a still sluggish non-residential sector.

Other details of the report showed average hourly earnings rose 0.4 percent or 10 cents. Tepid wage growth has been holding back the consumer-driven economy.

The length of the average workweek held steady at 34.5 hours.



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38 Comments

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DRW trading co.

how exciting 190,000 new jobs wow only problem with is that 300,000 joined the job market in that same period and that is making stock market gain something wrong here

August 07 2013 at 11:51 AM Report abuse rate up rate down Reply
dopey.obamite

I quit my job in January 2009, because there was no longer a Republican in the white house. Our new lord and savior was inaugurated and I knew he was going to take from those greedy rich pigs and give some to me!

July 07 2013 at 12:40 AM Report abuse rate up rate down Reply
Robert & Lisa

So, Obama and his goons said that the sequester that he signed into law would ruin the economy. Now, because government has been forced to cut back the economy is starting to pick up. Just think of how far along in fixing the economy if we'd elected a real capitalist like Romney for President. We've had two hard line socialist Presidents for the last 13 years and look where it has put us. THINK people.

July 06 2013 at 3:19 AM Report abuse -1 rate up rate down Reply
evan_barthold

yall crackus keeps werkins soes weez don't hafta okay ?

July 05 2013 at 2:50 PM Report abuse +3 rate up rate down Reply
1 reply to evan_barthold's comment
evan_barthold

dats wize weez turnd mooslem counta days don't likes crackas, day enfadells.

July 05 2013 at 3:12 PM Report abuse +2 rate up rate down Reply
Bill

It's great, $80,000,000,000 additional government borrowing a month, 200000 new jobs a month - that's $400,000 per job per month.
Now I am sure that the new hires do not get $400K a month, so where is the rest of the money going?

July 05 2013 at 2:37 PM Report abuse +2 rate up rate down Reply
1 reply to Bill's comment
evan_barthold

sheet iz gets free rents, food, cells fone arredy, Im a mooslem now so weeze gots ta helps da mooslem brutha hood to jihad da enfadells. are leeder bu-rack is guna helps us do dat

July 05 2013 at 2:47 PM Report abuse +2 rate up rate down Reply
evanbartheld

I like my mooslem president, he say we don't havta by helth surance cause we mooslem. Donts need no jobs eever

July 05 2013 at 12:23 PM Report abuse +3 rate up rate down Reply
2 replies to evanbartheld's comment
evanbartheld

We has al kinds of aminals on da farm to, sept pigs. Us mooslems cant eats em.

July 05 2013 at 12:28 PM Report abuse +3 rate up rate down Reply
evanbartheld

Sides, we alreddy has a ful tim job with jihad on da enfedals

July 05 2013 at 12:32 PM Report abuse +2 rate up rate down Reply
evanbartheld

Why does anyone want a job I gets sechun 8 food stamp helth care. President Obama is so great.

July 05 2013 at 12:20 PM Report abuse +3 rate up rate down Reply
2 replies to evanbartheld's comment
h.hughjardon

So you milk bulls for free then?

July 05 2013 at 12:22 PM Report abuse +4 rate up rate down Reply
evanbartheld

Oh yes, on my retard farm.

July 05 2013 at 12:24 PM Report abuse +3 rate up rate down Reply
h.hughjardon

Declining participation as older Americans retire and younger people give up the hunt for work in frustration has accounted for much of the drop in the unemployment rate from a peak of 10 percent in October 2009.
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Hats off to this Reuters reporter for finally including this in the monthly jobs report. The effects of workforce participation is rarely included in these Daily Finance articles except for when the unemployment rate ticks up.

July 05 2013 at 12:18 PM Report abuse +4 rate up rate down Reply
Russell

Where was your car made? Where was your BBQ grill made? Where was your computer made? Where was your cell phone made? Where are your clothes made? Where are all the nuts, bolts, screws, and nails made?
That is where all the American jobs went! Just so you save a few pennies at Walmart and Home Depot!
And the rich aren't getting poorer!
The rich have the lowest tax rates in years!

July 05 2013 at 10:58 AM Report abuse +1 rate up rate down Reply
1 reply to Russell's comment
h.hughjardon

The rich have a mrginal tax rate of 39.6%. That is the highest since the clinton administration.

WTF are you talking about rustle?

July 05 2013 at 11:55 AM Report abuse +1 rate up rate down Reply
youitno22

Low paying crapy jobs and unemployment was 340,000 so we are still going backwards and will until we get this lying conartist president and all the liberal idiot demcrats that have ran congress for the past 7 years. Notice thats when things started gettting bad.

July 05 2013 at 10:56 AM Report abuse +1 rate up rate down Reply

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