US hiring cools in June as hospitality jobs decline

The United States added 57,000 jobs in June, a weaker pace after months of steadier hiring, according to the Bureau of Labor Statistics. The report matters because it showed softer job creation even as the unemployment rate edged lower.

The Labor Department data, released Thursday, also cut earlier estimates for spring hiring. The Bureau of Labor Statistics revised May payroll growth to 129,000 from 172,000 and lowered April’s total by 31,000 jobs to 148,000.

Hiring gains were concentrated in a limited group of industries, according to the report. Professional and business services added 36,000 jobs, healthcare added 22,000, and social assistance added 25,000.

Several major sectors showed little change, the Bureau of Labor Statistics said. Those included mining, oil and gas extraction, construction, manufacturing, wholesale trade, retail trade, transportation and warehousing, and financial activities.

The biggest reversal came in leisure and hospitality, where employment fell by 61,000 jobs ahead of the summer travel season. Al Jazeera reported that the decline ran against expectations that tourism tied to the ongoing FIFA World Cup would lift hiring.

Goldman Sachs had forecast that the tournament would add 40,000 jobs in June, according to Al Jazeera. Instead, the sector shed workers during a period that is usually busy for travel, lodging and restaurants in the US.

Unemployment falls, participation weakens

The unemployment rate slipped to 4.2 percent from 4.3 percent, the Bureau of Labor Statistics said. A broader measure of unemployment, known as U-6, fell to 7.9 percent from 8.1 percent; that measure includes discouraged workers, people marginally attached to the labor force and part-time workers who want full-time jobs.

The lower unemployment rate came with a decline in labor force participation. The participation rate fell 0.3 percentage point to 61.5 percent, its lowest level since March 2021, according to the report.

Other labor data released this week pointed to a cooling but not collapsing job market. ADP said private employers added 98,000 jobs in June, while the Labor Department’s jobs and labor turnover report was unchanged, suggesting limited movement by workers between jobs.

Nela Richardson, ADP’s chief economist, said in a statement that hiring reflected both demand and supply pressures. “We know it’s taking people longer to find work, but there also are signs of labour supply constraints in certain industries,” Richardson said, adding that the overall result was slower job creation.

Consumer confidence data also showed more strain among job seekers. Al Jazeera reported that a Conference Board survey released Tuesday found the share of people saying jobs were “hard to get” jumped by 22.5 percent.

Markets rise after the report

US stocks moved higher despite the weaker payroll figure, according to Al Jazeera. The Nasdaq and S&P 500 were each up 0.6 percent after the open, while the Dow rose 0.8 percent.

Gold also gained after the jobs data, rising 2 percent, Al Jazeera reported. The move came as investors read the softer employment figures as a sign that the Federal Reserve may avoid raising interest rates in the near term.

This story draws on original reporting from Al Jazeera.