Visions of the long-awaited slowdown for the economy may be nearing reality, as the latest employment report indicated little change in nonfarm payroll for the month of June. The unemployment rate declined 0.1% to 4.0%, as expected, but growth in nonfarm payrolls finished the month well below expectations. The continuing evidence of slowing economic growth is leading many economists to believe the Federal Reserve will not raise interest rates at their next meeting in August.
Nonfarm payroll employment increased a mere 11,000 in June, according to the Labor Department's June 2000 Employment Report. Some highlights from the report are listed below:
- Construction employment was unchanged and has averaged 20,000 new jobs a month in 2000, compared to 25,000 a month in 1999.
- Employment in the services industry increased by 148,000, following an unusually small gain of 17,000 in May. Engineering and management services employment continues to grow.
- New jobs in air transportation and communications accounted for most of the 18,000 jump in transportation and public utilities employment.
In the manufacturing industry, employment grew by 8,000 in June, following a decline of 12,000 in May. The breakdown for durable and nondurable goods in June is as follows:
- 14,000 new jobs in durable goods manufacturing, with gains in electronic components, fabricated metals, industrial machinery, and autos
- a decline of 6,000 jobs in nondurable goods, pushed down by continued declines in apparel and textiles
In the past 10 months, job increases in durable goods manufacturing (38,000) have been offset by losses in nondurable goods (34,000).
At a Glance: Hours and Earnings
- The manufacturing workweek increased 0.2 hour to 41.6 hours, and overtime edged up 0.1 hour to 4.6 hours.
- Average hourly earnings rose 5 cents to $13.71, following a 1-cent gain in May.
- Average weekly earnings were up 0.7% to $473.00.
- Over the past 12 months, both average hourly earnings and weekly earnings have increased by 3.6%.
The report on July employment will be released on August 4, 2000.