The U.S. economy gained about 70,000 more jobs than economists had expected in June. The unexpectedly-high job numbers dropped the unemployment rate to its lowest level since September 2008.
According to the most recent monthly report from the Bureau of Labor Statistics (BLS), the June unemployment rate was 6.1 percent. The private sector netted 262,000 nonfarm job gains while local, state, and federal governments netted 26,000, for a total net gain of 288,000.
The private sector has gained nonfarm jobs for 52 consecutive months since the Great Recession. The U.S. economy has created over 200,000 jobs per month for five consecutive months, the longest such streak since September 1999 through January 2000. Additionally, the economy added 1.4 million jobs in the first six months of this year, the most in any first half since 1999.
Better yet, the BLS upwardly revised net job gains for April from 282,000 to 304,000. The last time that the economy gained in excess of 300,000 jobs in one month was in January 2012. The BLS also upwardly revised its job numbers for May from 217,000 to 224,000. Job growth has averaged 272,000 per month in the past three months.
The Dow Jones celebrated the job numbers with an all-time high of 17,000 just after market open today. Additionally, according to USA Today, the S&P 500 also ended the trading day (shortened by the July 4th holiday) in an all-time high with Nasdaq finishing at 14-year high.
At 67,000, the most notable June net job gains were again in the professional and business services industry. Temporary help services (“temp workers”) gained 10,100 of those. The industry as a whole has netted an average of 53,000 job gains per month over the past year.
Next in line for the most notable was the retail trade industry at 40,000 job gains. The industry has netted an average of 26,000 job gains per month over the past year.
Employment in the construction industry continued to trend upward in June, though only slightly with 6,000 net job gains. Manufacturing, an industry that economists consider to be a gauge of labor market health, netted 16,000 jobs. All of the gains were in durable goods and were offset by 1,000 job loses in nondurable goods.
Among the major work groups tracked by the BLS, teenagers again suffered the highest unemployment rate (21.0 percent) followed by blacks (10.7), Hispanics (7.8), adult men (5.7), adult women (5.3), whites (5.3) and Asians (5.1, not seasonally adjusted). Adult women and blacks experienced declines from May, while teenagers experienced an increase (as school ended for the summer). All other groups showed little or no change.
Workers who are 25 years of age or older and who have earned four-year college degrees or higher experienced a 3.3 percent unemployment rate in June, up slightly from 3.2 in May. Those in the same age group and who don’t have high school diplomas suffered a 9.1 percent rate, the same as in May.
The June unemployment rate of 6.1 percent declined from 6.3 percent in April and May. The unemployment rate has declined by 1.4 percentage points in the past year and is down by 3.9 from the recessionary-high of 10.0 percent set in October 2009 (see chart to your left). The pre-recession normal rate according to economists was between 4 and 6 percent.
For the BLS to count workers as unemployed (to calculate the unemployment rate), they must be actively seeking jobs in the four weeks preceding the count. The BLS counted 9.5 million workers as unemployed in June, down from 9.8 in May. The number of unemployed workers has declined by 2.3 million over the past year.
The count of unemployed workers does not include those who are involuntarily working only part time and with fewer benefits, if any, such as no health insurance, because they can’t find full-time jobs or employers cut their work hours. The number of involuntarily part-timers increased by 275,000 in June to 7.5 million.
The average workweek for both part-timers and full-timers was 34.5 hours in June, the same as it was in the prior three months. Average hourly earnings rose by 6 cents to $24.45. Average hourly earnings have risen by 2.0 percent in a year.
The unemployment rate also does not include “marginally-attached” unemployed workers. The BLS does not count them in the official rate because they stopped looking for work in the four weeks preceding the count, for reasons such as school attendance, family matters or their collective perception that there simply are no jobs.
The number of marginally-attached workers in June was 2.0 million, down slightly from 2.1 million in May. Among the marginally-attached, 676,000 were so-called “discouraged workers” because they gave up looking for work due to their shared perception that there are no jobs — at least not for them. The number of discouraged workers was down from the 697,000 that the BLS initially reported for May. (The BLS does not seasonally adjust any of the figures in this paragraph.)
The number of long-term unemployed workers, those who have been without jobs for 27 weeks or longer, was 3.1 million in June, down from 3.4 million in May. These workers accounted for 32.8 percent of the unemployed. Standard state unemployment benefits last only up to 26 weeks without extensions.
Since the beginning of this year, congressional Republicans have blocked passing a bill to further extend federal unemployment benefits into 2014. See the blog “Unemployment Benefit Extensions 2013 – Updated for 2014” for details.
If you are a recent victim of job loss or a reduction in work hours resulting from the high unemployment rate, then you might be eligible to collect full or partial unemployment benefits from the state unemployment office. You might also be eligible to continue your employer-provided group health insurance coverage through COBRA.
For more details about the June 2014 unemployment rate and job numbers, see the “Employment Situation Summary” by the BLS. The BLS plans to report the July unemployment rate on August 1. To receive notification like the above automatically, subscribe to Employee Rights Blog for free.
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Certain figures in this unemployment rate report were rounded and/or seasonally adjusted by the BLS, and are subject to revision by same (based on additional data that was not initially available). The unemployment rate chart pictured above was provided by the BLS.