Saturday, 23 February, 2019

Hospitals add 7k jobs in May

Hospitals add 7k jobs in May Hospitals add 7k jobs in May
Nellie Chapman | 04 June, 2017, 03:57

Although today's numbers were lower than what economists had expected, some say it's still enough to justify a rate hike in a couple weeks.

Most traders believe the Fed is highly likely to hike interest rates at its upcoming meeting on June 13-14.

The Bureau of Labor Statistics announced on Friday that the unemployment rate had fallen to 4.3%, the lowest level since 2001, all but guaranteeing that the Federal Reserve will raise interest rates at its next meeting this month. Weekly applications for unemployment benefits, which tend to reflect the pace of layoffs, averaged a low 238,000 over the past four weeks, according to the Labor Department. The employment-population ratio edged down to 60.0 percent in May. Average hourly earnings rose 2.5% in May versus a year earlier, the same as in April and slower than the previous months of the year. "Good public policy can support new job opportunities in manufacturing, but Congress is no closer to boosting infrastructure investment, and a pro-jobs tax reform effort seems like a fading possibility". Food services added 30,300 workers, while health care contributed 24,300 jobs. "That's always ugly", Dan North, chief economist at Euler Hermes North America, said of the decline.

The biggest gains, ADP said, were in medium-sized businesses (50 to 499 employees), with 113,000 new jobs for the month. "Once you get to the point where you can't find workers, firms will start pushing and raising wages".

The unemployment rate continued to fall and rising wage growth coupled with job gains indicate an economy on the rise, but the sluggish growth in the average hourly earnings (2.5 percent) is cause for concern.

The White House has hailed the rosier jobs reports in recent months and President Donald Trump has vowed to add 25 million new jobs to the economy over a decade.

Details of the employment report were weak. Over the past three months, job gains have averaged 121,000 per month, which is still considered as a healthy pace by many economists. The current pace of job growth is almost three times the rate necessary to absorb growth in the labor force.

The labor force participation rate, or the share of working-age Americans who are employed or at least looking for a job, fell two-tenths of a percentage point to 62.7 per cent. The current jobs report, in fact, revises April numbers down from 211,000 to 174,000 jobs added for that month. The smaller and more volatile survey of households also showed a drop in employment. In the four full months Trump has been in office, the US economy, as of this morning's new data, has added 601,000 private-sector jobs. Retail employment fell 6,100, declining for a fourth straight month, with department stores shedding 3,700 jobs. But judging by today's response to the job numbers, traders may be having second thoughts about whether the U.S. is at full employment, too.