The Department of Labour has released data for the month of June. According to the findings, the American economy is performing well in terms of the labour market: 147,000 new non-agricultural jobs and an unemployment rate of 4.1%, one decimal point lower than the previous month. However, all that glitters is not gold, as job growth is limited to a few sectors of the economy and, according to several experts, is actually declining.
The first figure, published by the Department of Labour, concerns half of the hires: 73,000 new jobs are public sector jobs, created by the government. 40,000 of these are new hires in state public education, a seasonal phenomenon linked to the end of the school year.
Job growth in the private sector was 74,000, the lowest since October 2024. The healthcare sector dominated hiring with 39,000 new jobs in hospitals, nursing, and residential care facilities. Similarly, employment in the social assistance sector grew by 19,000. These sectors are referred to as “non-cyclical” because they are not affected by economic cycles; they perform well even in times of crisis because they provide essential goods and services.
Elsewhere, manufacturing lost 7,000 jobs and wholesale trade lost 6,600. There were also 7,000 fewer jobs in the professional and business services sector, with little growth in the retail sector (+2,400). The largest increases were in the transport and warehousing sector (+7,500) and construction (+15,000).
Brian Bethune, professor of economics at Boston College, told Reuters, “The private sector clearly lost momentum in the second half of the second quarter, which does not bode well for the economy in the third quarter.” In addition, long-term unemployment has increased, with the number of workers unemployed for 27 weeks or more rising by 190,000 to 1.657 million.
Meanwhile, the issues of tariffs and interest rate cuts by the Fed remain unresolved. Jerome Powell, the chairman of the US central bank, continues to resist President Donald Trump’s demands for lower rates. We need to ‘wait and gather more information’ on tariffs and inflation before lowering them again, Powell said. Meanwhile, when asked about the possibility of replacing him as Fed chairman, Treasury Secretary Scott Bessent said, ‘I will do what the president wants.’
