CNN
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On the face of it, the June jobs report presents a robust picture of the US economy, with a historically low unemployment rate, a healthy number of jobs added and wage growth that outpaces inflation. But a closer look at the data reveals blemishes that could mar that rosy outlook — with President Donald Trump’s economic policies as the most significant common denominator.
The monthly headline number of 147,000 soundly beat out expectations of 117,500 net job gains, with a healthy upswing in traditionally steady industries like local and state government, education, leisure and hospitality and health care.
And the unemployment rate also looks encouraging, falling to 4.1% against expectations of a rise to 4.3% for the first time since October 2021, when the country was still in the throes of pandemic upheaval.
Even the dreaded monthly revisions offer promise — April and May were both revised upward, while in previous reports, prior months have tended to see (sometimes hefty) downward revisions. For example, March’s stronger-than-expected 228,000-job gain was ultimately revised down by 108,000 jobs.
But, beyond the top-level data, things get a little murkier in the June report:
It is becoming harder for Americans to find work: The average duration of unemployment rose from 21.8 weeks to 23 weeks, and the share of unemployed workers who have been out of a job for 27 weeks or longer rose to 23.3%, edging closer to a three-year high. Trump’s tariffs — and the dizzying back and forth on implementing them and pausing them — has caused many businesses to stall major decision-making or spending, including hiring.
Manufacturing employment was down: The sector saw a decline for the second-straight month, losing 7,000 jobs — a cloudy development for one of Trump’s benchmark economic priorities.
Job growth was not widespread: Sectors that saw the biggest monthly gains were mostly ones that are less affected by tariffs.
Employees worked fewer hours: The average workweek edged down by one-tenth of an hour, to 34.2 hours, in June. This potentially signals a weakening in the demand for labor, economist Dean Baker of the Center for Economic Policy Research noted.
The unemployment rate for Black Americans rose: The jobless rate for Black workers increased in the June report, rising from 6% to 6.8%, its highest rate since January 2022. That’s typically an indicator of economic weakness, but it’s also a volatile number from month to month.
More women are leaving the workforce: The data indicates that job gains could be going mostly to men: Since January, a net 338,000 women have left the labor force, while 183,000 men have joined the labor force, the National Women’s Law Center noted on Thursday.
Wage growth gains have slowed: While the pace of wage growth increased last month, it was at a slower rate than economists expected. Average hourly earnings rose by just 0.2% in June, bringing the annual growth rate to 3.7% from 3.9%.
There’s some fuzzy math to understand: The unemployment rate went down and the size of the labor force also went down — mostly because the US lost more than 1 million foreign-born workers in the last quarter. That rebalancing essentially allows the jobless rate to stay unchanged or even drop, despite an increase in the number of people out of work.
About those workers: Trump’s policies include a large-scale immigration crackdown and targeted deportation of workers, depriving companies of what has been a key sector of the labor force in recent years.
For now, the US job market continues to defy expectations. But with Trump’s self-imposed July 9 deadline approaching for key US trading partners to reach a deal on tariffs, and his signature domestic policy bill still being debated in Congress, businesses and their workers remain frozen in a state of uncertainty.
