Home   Logon   Mobile Site   Research and Commentary   About Us   Call 1.800.621.1675 or Email Us       Follow Us: 

Search by Ticker, Keyword or CUSIP       
 
 

Blog Home
   Brian Wesbury
Chief Economist
 
Click for Bio
Follow Brian on Twitter Follow Brian on LinkedIn View Videos on YouTube
   Bob Stein
Deputy Chief Economist
Click for Bio
Follow Bob on Twitter Follow Bob on LinkedIn View Videos on YouTube
 
  Nonfarm Payrolls Rose 4.80 Million in June
Posted Under: Data Watch • Employment

 

Implications:  The wild ride continues.  After plummeting at the fastest pace ever in April, nonfarm payrolls rose at the fastest pace ever in May and have done so again in June, adding 4.8 million jobs for the month.  Even better, almost all of the gain was in the private sector, with leisure and hospitality leading the way, while retail, education & health services, and manufacturing also added a substantial number of jobs, as well. The labor market has a long road ahead to be fully-healed, but, in the past two months, has recovered one-third of the payrolls lost in March and April.  Civilian employment, an alternative measure of jobs that includes small-business start-ups, tells a similar story, up 4.94 million in June and also regaining in May and June one-third of the employment lost in March and April.  Another piece of relatively good news is that the unemployment rate, which the consensus expected to come in at 12.5%, arrived at 11.1%, instead.  That's still very high by historical standards, but much lower than the peak of 14.7% in April.  The labor force (people working or looking for work) increased by 1.7 million in June after a similar gain in May, although it's still down substantially from earlier this year.  The worst headline of the report was that average hourly earnings fell 1.2% in June.  However, recent declines are a return to normal after a huge surge in April.  Job losses in April were concentrated among lower-paid workers, so average hourly earnings rose because those still working typically made more money.  Now, as lower-paid workers are rehired, their pay levels reduce average earnings.  We like to track what the report means for workers' earnings, and today's news was good.  Total hours worked increased 3.6% in June. Multiplying hours by earnings shows that total earnings rose 2.4%.  That said, total earnings are still down 4.3% versus a year ago, which means workers have less purchasing power generated by actual production, versus purchasing power coming from government benefits.  As we said last month, the unemployment rate is going to remain at unusually high levels for at least the next few months, but today's report is a testament to the entrepreneurial spirit and how quickly businesses have been able to adapt to a global pandemic and unprecedented shutdowns of the US economy.  A full recovery is still a long way off, but there should no doubt at this point that the recovery has started. 

Click here for PDF version

Posted on Thursday, July 2, 2020 @ 10:49 AM • Post Link Share: 
Print this post Printer Friendly

These posts were prepared by First Trust Advisors L.P., and reflect the current opinion of the authors. They are based upon sources and data believed to be accurate and reliable. Opinions and forward looking statements expressed are subject to change without notice. This information does not constitute a solicitation or an offer to buy or sell any security.
 
The information presented is not intended to constitute an investment recommendation for, or advice to, any specific person. By providing this information, First Trust is not undertaking to give advice in any fiduciary capacity within the meaning of ERISA, the Internal Revenue Code or any other regulatory framework. Financial professionals are responsible for evaluating investment risks independently and for exercising independent judgment in determining whether investments are appropriate for their clients.
First Trust Portfolios L.P.  Member SIPC and FINRA. (Form CRS)   •  First Trust Advisors L.P. (Form CRS)
Home |  Important Legal Information |  Privacy Policy |  California Privacy Policy |  Business Continuity Plan |  FINRA BrokerCheck
Copyright © 2020 All rights reserved.