Thread by @DanielBZhao

June's #JobsReport shows the job market holding steady despite recession fears. Job gains slowed modestly to 372,000, beating expectations, and unemployment held flat at 3.6% for the 4th month in a row.

This is still a hot labor market even if the broader economy is cooling.

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Job gains cooled only modestly in June, beating expectations. Job gains overall seem to have shifted into a lower gear in the last few months, but recall that in 2019's hot job market, monthly job gains averaged 164k. This is still a healthy clip.

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Most industries added jobs in June in broad-based gains across the board. A few industry stories:
1. Despite concerns about rotation from goods to services, job gains returned in #retail (+15.4k) and held strong in leisure & hospitality (+67k)

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2. Despite the housing market slowdown, job gains in related industries were maybe muted, but we didn't see large job losses:

Construction: +6k
Real estate: +3.7k

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3. Despite reports of prominent layoffs, #tech industries saw job gains in June:

Information: +25k
Computer systems design and related services: +10k

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With the steady progress in June, payrolls are within striking distance of pre-pandemic levels, just over half a million away. Despite slowdown fears, that milestone is still within reach if we get another 2 months of solid jobs growth.

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Wage growth is cooling:
Average hourly earnings growth slowed to 5.1 percent year-over-year. Wage growth has slowed even more in recent months, growing at just a 4.2% annualized pace over the last quarter and a 3.8% annualized pace in June.

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The unemployment rate was flat at 3.6 percent in June, for the fourth month in a row. The picture in June, however, is different from recent months bc of the backdrop of falling labor force participation in June...

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The labor force participation rate ticked down to 62.2 percent from 62.3 percent, and that picture looks even worse for prime-age (25–54) workers where the participation rate dropped 0.3 pp, reversing 3 months of gains.

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The drop in labor force participation was in large part driven by a decline for Black workers who saw labor force participation fall back after jumping in May. The Black unemployment rate did drop, but you don't want to see that happening w/ falling LFP

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Workers who are part-time for economic reasons dropped by 707,000, meaning many part-time workers who want full-time work are finding it bc of the strong labor market.

As a share of total employment (right), this is the lowest level on record.

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Overall, today's #jobsreport reiterates that the labor market is a bright spot in the recovery. The drop in LFP was a blemish, but so far, recession fears have not yet materialized in the labor market.

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