Nonfarm payrolls increased by 288,000 jobs last month and the unemployment rate fell to 6.1 percent, its lowest level since September 2008.
Employment has now grown above a 200,000-jobs pace for five straight months for the first time since the technology boom in the late 1990s.
Average hourly earnings, which are being closely watched for signs of wage pressures that could signal dwindling slack in the labor market, increased by 6 cents in June. The 12-month gain slipped to 2.0 percent from 2.1 percent, suggesting little build up in wage-related inflation pressures.
A broader measure of unemployment, which includes people who want a job but have given up searching and those working part-time because they cannot find full-time jobs, fell to 12.1 percent, the lowest level since October 2008.
The median duration of unemployment fell to 13.1 weeks from 14.6 weeks in May, the lowest in more than five years.
My opinion: There is just so much good stuff to talk about here. At the beginning of the article, economist Jacob Oubina is quoted, “It’s a report that really checks off all the positive boxes. I don’t think you could have asked for a stronger read.”
In my opinion, a great statistic that can be easily overlooked is the discouraged worker number. A decrease in this number means people who had stopped looking for a job are now looking again. A very optimistic statistic. Although this may keep wages low in the near term as the supply of labor begins to grow.
The median duration of unemployment also fell as the majority of unemployed workers is turning over faster. For the growth of the economy, this is a fantastic statistic. The less time people are without a job, the more they are able to spend. And the more they spend, the more firms must produce. And when a firm needs to produce more, they hire more workers. This is exactly the impetus to our economy that we have desperately needed.
Lastly, wages went up. And in my last post I said that an increase in wages would signal a big momentum swing. However, I am hesitant to say this is the signal I wanted as wages only increased marginally due to the large amount of slack in the labor market. I am waiting for a 4-5% wage growth before ringing that victory bell.
The economy feeds off itself. Doing well leads to doing better. And with numbers like these, I fully expect the spiral upwards to gain more and more momentum over the second half of the year.