National Unemployment Rates at 5.3 Percent
Since it peaked at 9.6 percent in 2010, the U.S. annual unemployment rate has declined every year, reaching 6.2 percent in 2014 and today’s percentage at 5.3 percent. While the country may be on the path to full recovery from the recession, many job gains have been in part-time and lower wage employment.
The U.S. Department of Labor released its highly awaited unemployment and payrolls report for the month of June and it looks like an inline report, but the reality is that there is some really soft data in this report.
The Bureau of Labor Statistics reported that there was a gain of 223,000 in non-farm payrolls and employment analyst had expected the numbers to come in at 230,000. The official unemployment rate was came in at 5.3 percent, which was 0.10% lower than the last report at 5.4 percent. Employment analyst had expected the rate to remain at 5.4 percent, but the decrease isn’t necessarily good news due to a labor force participation rate is at a dismal 62.6 percent.
The participation rate was a sharp drop of 0.3 percent from May and was the lowest in years! We also receive some downward revisions of a combined 60,000 payrolls for the prior two months and broker down as follows:
254,000 in May, versus the 280,000 original forecast and;
April was revised to 187,000 from a previous forecast of 221,000.
Payrolls in the private sector grew by 223,000 in June, compared to employment analyst estimating 225,000.
Average hourly earnings remain flat at $24.95, and the average workweek didn’t improve either with an average of 34.5 hours per week. Wages have remain stagnant at approximately two percent while housing cost have widely out pace wages making home ownership only harder to achieve for many would-be home buyers. Wages clearly represent one of our most pressing challenges. To help more people get a fair day’s pay for an honest day’s work, President Obama this week announced a proposed change in the rules governing time-and-a-half overtime pay that would restore overtime protections to nearly 5 million salaried workers.
Today’s report confirms America needs to do much more to stimulate job growth. One action we could take immediately would be to stimulate middle class incomes by government sector bridge and road construction. With today’s ultra-low interest rates Hollywood East could lock in low rates and create a strong employment recovery, but leave it to our plutocrats to wait until rates increase and our bridges and road are in such dismal repair, cost will be tenfold.
The only real good news we can point to in the jobs reports is it’s unlikely Janet Yellen and the federal reserve will be in any hurry to hike the overnight federal funds rate rates anytime soon.
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