U.S. economy posts largest jobs gain in eight months

The US economy added 287,000 jobs in June - exceeding expectations after two months of disappointing job growth.

Trucking lost 6,300 jobs last month, and that follows downward adjustments to the April and May numbers, according to the latest jobs report from the U.S. Dept. of Labor.

In June, thousands of jobs were added in retail, hospitality, health care, business and professional services, retail and financial services.

May's payroll gain - the smallest since September 2010 - in part reflected the loss of 35,100 Verizon workers, who were excluded from the count while on a month-long strike.

The unemployment rate rose to 4.9% driven by a large increase in the labor force (414,000), partially reversing the sharp decline in May, to 4.7% from 5.0% in April, which was driven by a large decline in the labor force (458,000).

Wages improved modestly, with average hourly earnings climbing 0.1 percent from a month earlier.

Markit's chief economist, Chris Williamson, said: "It's far from clear whether June's bumper non-farm payroll increase reflects a renewed appetite for companies to hire staff". Friday's Labor Department figures suggest that the US economy, which has defied overseas weakness before, might be able to do so again. They cited the weak jobs figures during their June meeting as a key reason for putting off any further rate increases.

That largely compensated for the poor numbers from May that had shocked policymakers and markets, sending the dollar lower and contributing to the Federal Reserve's decision last month to put off an interest rate hike.

Even with June's anticipated jobs bounce back, forward momentum in the labor market has slowed.

USA stock futures rose sharply after the report.

The proportion of people employed or actively looking for work has also been dragging along at low levels, suggesting that more people would return to the workforce if desirable jobs were available. Healthcare and social assistance added 58,000 jobs.

The Labor Department revised down May's already weak first estimate of 38,000 jobs to just 11,000. The U.S. was routinely adding well over 200,000 jobs a month. Wage growth picked up to 2.6%.

Instead, the latest employment data exceeded forecasts, and a broad range of industries reported job gains. The PayScale Index, which tracks the change in wages of employed USA workers, forecasts a 1.6 percent year-over-year increase in pay for the third quarter of 2016.

The recent hiring slump had come after the economy grew at a tepid 1.1 percent annual rate in the first three months of the year.

Vanessa Coleman

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