June jobs report defies expectations amid inflation

While the June reading confirms a healthy labor market, data from the Job Openings and Labor Turnover Survey (JOLTS) showed that job openings and quits declined for the second straight month in May, down by 427,000 and 57,000 respectively. But both remained elevated at 11.3 million and 4.2 million.

“Though the pace of hiring has slowed gradually over the past several months and the JOLTS survey has shown a potential easing to overall tightness in the labor market,” added Drake.

Job gains were strongest in the professional and business services (+74,000), leisure and hospitality (+67,000), and healthcare sectors (+57,000). Meanwhile, employment in other industries showed little change over the month, including construction (+13,000), mining and logging (+6,000), financial activities (+1,000), and government (-9,000).

Average hourly earnings in June rose at the expected +0.3% rate but were slightly down from the upwardly revised +0.4% the previous month. However, the labor participation rate continues to lag at 62.2%.