- US hiring slowed to just 57K jobs in June, missing forecasts as over 700K workers exited the labor force.
- June payrolls disappointed, but a 4.2% unemployment rate strengthened hopes the Fed may delay further rate hikes.
- Weak jobs growth boosted stocks and supported Bitcoin as investors trimmed expectations for tighter Fed policy.
U.S. job growth slowed sharply in June, adding far fewer jobs than economists expected and signaling that the labor market is losing momentum. The economy created 57,000 nonfarm jobs during the month, well below forecasts of 115,000, while May’s payroll figure was revised lower. Even so, the unemployment rate edged down to 4.2% as fewer Americans participated in the workforce.
According to the U.S. Bureau of Labor Statistics, payroll growth slowed from a revised 129,000 jobs in May. Household employment also fell by 507,000, while more than 700,000 people left the labor force, pushing the labor force participation rate down to 61.5%, its lowest level since March 2021. The figures suggest the drop in unemployment was driven more by fewer people looking for work than by stronger hiring.
Payroll Data Signals Slower Hiring
U.S. employers added fewer jobs than expected in June, pointing to a slowdown in hiring. Nonfarm payrolls increased by 57,000, well below economists’ forecast of 114,000. May’s payroll total was also revised down by 43,000 jobs. Even so, the unemployment rate fell to 4.2% from the expected 4.3%.
Professional and business services added 36,000 jobs in June, followed by social assistance with 25,000 and healthcare with 22,000. At the same time, leisure and hospitality lost 61,000 jobs as seasonal hiring eased. Average hourly earnings rose 0.3% from May and were up 3.5% compared with a year earlier.
Economists Debate Fed Outlook
Economist Peter Schiff criticized the June jobs report and the broader labor market, arguing that hiring remains weaker than the headline figures suggest. He wrote, “The Govt. claims just 57K jobs were created in June, well below the 115K expected.” He also argued that participation reached its weakest level since March 2021 after hundreds of thousands left the workforce.
Schiff further stated, “Full-time employment in June collapsed by 514K.” He also claimed manufacturing employment continued weakening despite trade policies.
The weaker-than-expected jobs report lifted market sentiment as investors scaled back expectations for another Federal Reserve rate increase in September. Treasury yields fell, while stock futures moved higher after the data. Slower payroll growth could ease pressure on policymakers to tighten monetary policy.
Bitcoin and other cryptocurrencies also remain sensitive to labor market data because expectations for Federal Reserve interest rates continue to influence demand for risk assets.
Related: Why Bitcoin Usually Rises in July and What Traders Should Expect This Time?
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