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Unemployment falls to 6.1 percent amid U.S. hiring surge
Question of the Day
The nation’s unemployment rate plunged to 6.1 percent last month as businesses went on a hiring spree, adding 288,000 new jobs, the Labor Department reported Thursday.
Businesses also added 29,000 more jobs in April and May than previously reported, bringing the April total to an impressive 304,000. The nation has not seen such hefty job gains since the late-1990s tech hiring boom. Job growth had averaged under 200,000 a month for most of the recovery from the Great Recession.
“The first half of 2014 has been the best six months for job creation in this lacklustre recovery,” said Joseph Lake, analyst at the Economist Intelligence Unit. He noted that the biggest surge in jobs in nearly two decades occurred during and after an unusual plunge in economic output of 2.9 percent during the first quarter.
“Companies are creating jobs at a rapid rate, while the economy is tanking,” he said. “With such conflicting narratives, and a disconnect between headline [Gross Domestic Product] and employment, it is difficult to know what is happening in the underlying economy.”
But he added that the pick-up in economic momentum shown in the jobs report is likely the more accurate reflection of the economy’s underlying strength, as it corresponds with a period of rising consumer confidence, stronger factory output and an uptick in the housing market.
“The U.S. economy is gathering momentum,” he said.
Employment increased in a broad array of industries in June, including retail, restaurants, health care and such business services as consulting, architecture, finance and computer design, the department said.
The solid increase in high-wage jobs service and professional jobs raised average wages by 6 cents during the month to $24.45, bringing the annual wage gain to 2 percent, the department said.
Some economists saw a breakthrough in the robust news on jobs.
“There is simply no bad news in this jobs report. Go on, dig into the detail, and see if you can find it. I dare you,” said Justin Wolfers, economics professor at the University of Michigan.
“The really big news: Long-term unemployment keeps on falling,” he said, noting that the number of people unemployed for six months or longer fell 293,000 last month and is down by 29 percent in the last year.
While the number of U.S. adults participating in the labor force also fell to a record low, Mr. Wolfers attributed that to the inevitable retirement of Baby Boomers, the oldest of whom this year reached the age of 68.
The upbeat report prompted a surge in the value of the U.S. dollar and was expected to spark a major rally on Wall Street, where the Dow Jones industrial Average was poised to sail past 17,000 for the first time.
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