Despite concerns that the tariff policies of the Donald Trump administration might lead to an increase in unemployment, job growth in the United States last month showed a positive trend, with unemployment rates actually declining. The U.S. Department of Labor reported on the 3rd (local time) that non-farm jobs increased by 147,000 in June compared to the previous month. This growth maintained the monthly average increase of 146,000 over the past 12 months and significantly surpassed the expert forecast of 110,000 compiled by Dow Jones.
Moreover, the job growth figures for April were revised upward by 11,000 from an increase of 147,000 to 158,000, and for May, the increase was revised upward by 5,000 from 139,000 to 144,000. The upward revision for April and May combined reached 16,000. State government employment increased by 47,000, primarily driven by the education sector, which saw an increase of 40,000 jobs, while the healthcare sector added 39,000 jobs.
Federal government employment declined by 7,000 in June, reflecting a restructuring of public-sector employment led by the Department of Government Efficiency (DOGE). Since January, the cumulative decline in federal government employment has reached 69,000.
Average hourly wages rose by 0.2% from the previous month and by 3.7% compared to the same period last year, which is slightly below the market expectations of a 0.3% monthly increase and a 3.9% yearly increase. Meanwhile, the unemployment rate in June fell to 4.1% from 4.2% the previous month, coming in below the expert forecast of 4.3%. The labor force participation rate in April decreased by 0.1 percentage point to 62.3% from the previous month.
The job growth exceeding expectations and the decline in the unemployment rate indicate that the U.S. labor market remained robust in June despite the Trump administration’s tariff policies. Following the release of the employment data, bond yields rose and the value of the dollar strengthened. Market expectations for an early interest rate cut by the Federal Reserve (Fed) also dampened. According to the CME FedWatch tool, the probability of the Fed keeping interest rates unchanged at the July 29-30 monetary policy meeting increased to 95% following the release of the employment data, up from 76% the previous day.
[Photo credit: AFP=Yonhap News/Getty Images Bank]
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