US economy surpasses expectations to add 147,000 jobs in June

{"text":[[{"start":null,"text":"

"}],[{"start":26.348,"text":"The US economy added 147,000 jobs in June, defying expectations that trade uncertainty would cause hiring to cool and leading investors to scale back their bets on interest rate cuts."}],[{"start":26.848,"text":"Thursday’s figure from the Bureau of Labor Statistics surpassed both the upwardly revised 144,000 posts added in May and the 110,000 predicted by economists polled by Bloomberg, despite concerns that Donald Trump’s tariff and immigration policies would soften labour demand."}],[{"start":27.348,"text":"Wall Street investors welcomed the data and helped push the S&P 500 up 0.8 per cent to a record high in a shortened trading session ahead of the Independence Day public holiday. US government bonds sold off."}],[{"start":27.848,"text":"The unemployment rate also beat expectations, falling slightly to 4.1 per cent. Jobs figures for April and May were revised higher by a combined 16,000."}],[{"start":28.348,"text":"Trump hailed the report, reposting a Department of Labor message on X claiming the BLS figures had “shattered” expectations."}],[{"start":28.848,"text":"The unexpectedly strong figures should ease pressure on the US Federal Reserve to cut interest rates, despite the US president’s repeated calls for the central bank to do so."}],[{"start":29.348,"text":"Traders are now betting that there is a roughly 5 per cent chance of the Fed lowering borrowing costs this month, compared with about 25 per cent before the jobs data."}],[{"start":null,"text":""}],[{"start":29.848,"text":"“The numbers were much, much higher than expected,” NatAlliance Securities head of international fixed income Andy Brenner said of the jobs data."}],[{"start":30.348,"text":"“This takes a July cut off the table,” Brenner continued. “Even with a massive deceleration in [the consumer price index], you will not see a cut from the Fed in July. Even September now is somewhat in question.”"}],[{"start":30.848,"text":"The two-year US Treasury yield, which moves with interest rate expectations and inversely to prices, was up 0.09 percentage points on Thursday afternoon to 3.88 per cent. The dollar gained 0.4 per cent against a basket of rival currencies as investors bet the Fed will lower rates more slowly than previously thought."}],[{"start":31.348,"text":"The US central bank has been split over when to cut rates. Its monetary policy “doves” seek to lower borrowing costs to offset any softening of economic growth, while “hawks” prefer to hold off owing to fears that tariffs will push up inflation."}],[{"start":31.848,"text":"Fed chair Jay Powell has faced continued pressure from Trump to cut rates. On Wednesday the president called on him to “resign immediately”."}],[{"start":32.348,"text":"Below Thursday’s headline payroll figures, analysts sounded a more cautious note over the lack of turnover in the job market and warned the impact of the president’s sweeping tariffs and immigration crackdown would probably be felt later in the year."}],[{"start":32.848,"text":"“The labour market is precariously balanced between modest growth and a potentially larger rise in the unemployment rate in the coming months,” said Omair Sharif at Inflation Insights."}],[{"start":33.348,"text":"The small drop in the June unemployment rate was primarily a result of workers leaving the labour market rather than finding work. The number of people in long-term unemployment, or out of work for 27 weeks or more, rose by 190,000 to 1.6mn."}],[{"start":33.848,"text":"“The household survey really shows a labour market that has very little churn,” said Diane Swonk at KPMG. “There’s a sense of a frozen jobs market and we’re not through the ice. The unemployment rate fell, but it fell for the wrong reasons.”"}],[{"start":null,"text":""}],[{"start":34.348,"text":"The rise in the headline employment figure came largely from an increase in healthcare jobs and an unexpected jump in those employed by US state governments after minimal growth over the past two years."}],[{"start":34.848,"text":"Three sectors — hospitality and leisure, healthcare, and government — accounted for 87 per cent of new jobs over the past two-and-a-half years, according to ING economist James Knightley. “The traditional sectors we would typically associate with a strong and vibrant economy are not adding jobs,” he said."}],[{"start":35.348,"text":"Federal government employment continued to decline in the wake of the cost-cutting drive led by Elon Musk, with jobs now down by 69,000 since January."}],[{"start":35.848,"text":"Separately, the foreign-born labour force has contracted for three consecutive months, in a probable sign the Trump administration’s policies may be weighing on immigration. As of June, the three-month decline has been the largest since the first few months of the Covid-19 pandemic, according to an analysis of BLS data."}],[{"start":36.348,"text":"Florian Ielpo, head of macro at Lombard Odier Investment Managers, said the “bump” in state government employment “explains a significant portion of the increase above the consensus number”."}],[{"start":36.848,"text":"“So globally, not a bad report, but probably not as strong as initially suggested from the first read,” he said."}],[{"start":37.348,"text":"Additional reporting by Tommy Stubbington in London"}],[{"start":33.88,"text":""}]],"url":"https://audio.ftmailbox.cn/album/a_1751585425_3545.mp3"}