Unemployment Rate Falls To 5.3 Percent, But For The Wrong Reason
The U.S. economy keeps adding jobs at a steady pace, but the Labor Department report for June also shows more people are leaving the labor force and wages are not rising.
The economy added 223,000 jobs last month as unemployment fell to its lowest rate since 2008, the Labor Department said Thursday. The jobless rate dipped to 5.3 percent from 5.5 percent in May.
However, the number of net new jobs added in May was revised down to 254,000 from 280,000 previously reported. April's job gains were also revised downward.
Retailers added about 33,000 jobs in June and manufacturing grew by 4,000, but construction jobs were unchanged, the report said.
Those looking for an increase in wages in this report were disappointed, as average weekly earnings remained flat along with average weekly hours.
Stuart Hoffman, chief economist of PNC Financial Services, said ahead of the report that employers are starting to feel a squeeze.
"More and more employers are saying they're having trouble finding good qualified employees, or once they find them, holding onto them before they jump to some other job," Hoffman said.
Indeed, as Bloomberg reports, the unemployment rate fell to a seven-year low as more people quit the labor force:
"The participation rate, which indicates the share of the working-age people in the labor force, decreased to 62.6 percent, the lowest since October 1977, from 62.9 percent."
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