By Andrew Moran
The U.S. job market remained strong in June, as labor conditions continued to hold up amid economic uncertainty.
The economy added a better-than-expected 147,000 jobs last month, according to Bureau of Labor Statistics data released July 3.
For the first time since February, the unemployment rate fell, slipping to 4.1 percent from 4.2 percent.
Economists had expected 115,000 new jobs and an unemployment rate of 4.3 percent, according to FactSet.
Last month’s print was up from the 144,000 reading in May, which was revised slightly higher from 139,000. The April figure was also adjusted higher by 11,000 to 158,000.
Government employment accounted for most of the June gains. Although headcount in the federal workforce declined by 7,000—federal employment is down 69,000 this year—state and local government payrolls represented all of the increase.
Manufacturing payrolls fell by 7,000 for the second straight month.
The number of employed full-time workers advanced by 437,000, while employed part-time workers tumbled by 367,000.
Average hourly earnings rose 0.2 percent, down from 0.4 percent and below the consensus estimate. On a 12-month basis, average hourly earnings eased to a lower-than-expected 3.7 percent from 3.8 percent in the previous month.
The labor force participation rate slipped to 62.3 percent from 62.4 percent, and average weekly hours dropped to 34.2 from 34.3.
The number of long-term unemployed—individuals out of work for 27 weeks or more—surged by 190,000 to 1.6 million and accounted for 23.3 percent of all jobless people.
People working two or more jobs jumped by 282,000 to 8.865 million.
In addition, the gap between employed U.S. and foreign-born workers narrowed slightly last month.
Employed U.S.-born workers soared by 830,000. Conversely, the number of employed foreign-born workers declined by 348,000.
Market Reaction
U.S. stocks registered modest gains following the employment data in pre-market trading.
The leading benchmark averages were up by around 0.2 percent.
Yields on U.S. Treasury securities were mostly up across the board, with the benchmark 10-year topping 4.34 percent.
The U.S. dollar index, a measure of the greenback against a weighted basket of currencies, popped 0.5 percent after the June jobs report. The index, which has dropped by more than 10 percent this year, is poised for a tepid weekly gain of 0.1 percent.
“Given the strong jobs numbers along with the extension of tax cuts and potentially higher tariff levels once the 90-day pause expires, the Fed is much less likely to cut rates this month than many were talking about earlier this week,” Chris Zaccarelli, chief investment officer for Northlight Asset Management, said in a note emailed to The Epoch Times.
The futures market scrapped any expectations for a July interest rate cut, and investors are now placing overwhelming bets on a September reduction, according to CME FedWatch Tool data.
In recent weeks, there had been some hope on Wall Street that the Federal Reserve would lower the benchmark federal funds rate—a policy rate that influences business, consumer, and government borrowing costs—later this month after comments from two key central bank officials.
“The Fed is likely to wait until later in this quarter or even until the fourth quarter before they cut interest rates,” Zaccarelli said.
Falling Back, Springing Forward
Two reports presented differing perspectives on the U.S. labor market.
First, the Bureau of Labor Statistics’ Job Openings and Labor Turnover Summary found that the number of job vacancies surged to well above 7.7 million in May from 7.395 million in April.
This came in higher than economists’ expectations and was the highest reading of 2025.
The report also highlighted the continuing trend of employers neither hiring nor terminating employees as companies navigate through economic uncertainty. At the same time, more individuals quit their jobs, which economists view as a barometer of employment confidence.
Second, payroll processor ADP released its National Employment Report for June, confirming that the private sector erased 33,000 jobs, the first decline in two years.
Investors largely shrugged off the ADP report as the tech-driven Nasdaq Composite Index and broader S&P 500 notched fresh records on July 2.
The rise in U.S. stocks was fueled by President Donald Trump’s announcement of a trade agreement with Vietnam and traders’ lack of confidence in the private payroll data. Experts say that the firm’s data often underestimates employment growth and does not accurately reflect what the monthly jobs report indicates.
“ADP’s forecasting value is minimal on a monthly basis, yet still helpful in determining long term trends,” Jeffrey Roach, chief economist for LPL Financial, said in a note emailed to The Epoch Times.
The broader economy’s health, meanwhile, could become clearer heading into the Fourth of July holiday, says Mark Malek, the CIO of Siebert Financial.
In addition to the June jobs report, the latest trade deficit numbers and initial jobless claims were released.
The number of individuals filing for first-time unemployment benefits dropped by 4,000 to a lower-than-expected 233,000. Continuing claims—a measure of the number of unemployed people currently receiving jobless benefits—was unchanged at 1.96 million people.
The trade deficit, meanwhile, widened to $71.5 billion in May, slightly higher than the consensus estimate of $71 billion.
“What I can tell you with confidence is that by the end of this week, you will have a lot more data on the health of the economy and what the Fed may do next,” Malek said in a note emailed to The Epoch Times. “Unfortunately, that will still not be enough to accurately predict where the economy will be at the end of the year, nor the S&P 500 for that matter.”
