US Job Growth Remains Strong Despite Recession Warnings
While inflation remains high and economic forecasters are warning of a possible recession, the U.S. Bureau of Labor Statistics Friday reported job growth in the United States remains strong, with the economy adding 372,000 jobs in June and the unemployment rate remaining at 3.6% for the fourth month in a row.
In its report, the bureau said the job numbers are comparable to where they were in February 2020, just before the COVID-19 pandemic hit. The report shows the most notable job growth in June occurred in the professional and business services, leisure and hospitality, and health care sectors.
“Today, we learned that our private sector has recovered all of the jobs lost during the pandemic and added jobs on top of that. This has been the fastest and strongest jobs recovery in American history,” President Joe Biden said in a statement.
The bureau reports manufacturing employment increased by 29,000 in June and has returned to its February 2020 level.
“The historic strength of our job market is one reason our economy is uniquely well positioned to tackle a range of global economic challenges – from global inflation to the economic fallout from Putin’s war,” said Biden. “No country is better positioned than America to bring down inflation, without giving up all of the economic gains we have made over the last 18 months.”
The continued strong job growth may ease fears of a recession. Analysts say the U.S. Federal Reserve may see it as an inflation indicator and prompt another rise in interest rates. Last month, the central bank raised interest rates by three-quarters of 1% in the hope of bringing down the highest inflation rate seen in nearly 40 years.
There is fear that further interest rate hikes – designed to bring down prices by cooling demand – could spark a recession.
The Washington Post reports economists and policymakers are hoping U.S. jobs growth — which has been hovering around 400,000 new positions per month for much of the past year — will slow to a sustainable pace that could help moderate inflation, without a significant rise in unemployment.
Some information for this report was provided by the Associated Press and Reuters.