California Observer

More Jobs Added to the US Economy in June

Image Source: Forbes

Official numbers show that the US economy added 372,000 jobs in June, which was a lot more than what was expected.

According to economists, the nation should have added between 250,000 and 295,000 new jobs.

According to the US Bureau of Labor Statistics, the unemployment rate remained relatively low.

Some analysts think that the good news about jobs is a sign that US interest rates may be going up soon.

Seema Shah, a senior global strategist at Principal Global Investors, says, “Today’s job report should ease worries about an upcoming recession, but it doesn’t do anything to ease worries about a big Fed tightening in the near future.”

The labor market is still quite tight, indicating continued intense wage pressures.

In June, the unemployment rate remained at 3.6 percent for the fourth consecutive month.

Due to rising food and energy costs, the US is experiencing a rise in living expenses similar to other nations. Inflation reached a 40-year high of 8.6 percent in the year ending in April, and the US Federal Reserve has been raising borrowing costs in an effort to slow the rate of price growth.

Last month, the Federal Reserve raised its benchmark interest rate by three-quarters of a percentage point to a range of 1.5 percent to 1.75 percent, the largest increase in more than 30 years.

The US economy shrank by 1.6 percent annually in the first three months of the year, and Fed head Jay Powell recently told Congress that a recession is “a possibility.”

He says that Russia’s invasion of Ukraine, inflation that has been high for a long time, and aggressive tightening of monetary policy have all hurt the US economy and stock market in the first half of 2022.

Jobs data, however, lags behind economic indicators, which are frequently high just before a collapse.

In contrast to other recent economic releases, the “strong jobs data” stands out, according to Richard Flynn, managing director of Charles Schwab UK.

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