US economy adds 147,000 jobs in June, surpassing expectations amid Trump trade war
The number of jobs added surpassed expectations, as economists largely anticipated a drop in openings. Instead, 8,000 more jobs were added in June compared with May, according to new job figures from the Bureau of Labor Statistics (BLS). The unemployment rate actually decreased to 4.1%, down from 4.2% in May.
Job gains were seen in state government and healthcare, which saw increases of 47,000 and 39,000 jobs, respectively. Meanwhile, federal government job losses continued, with another 7,000 roles down in May, as the Trump administration continues to cut jobs. The total job loss in the federal government has been 69,000 since January.
Though the president's tariffs have rocked the US stock market, which has seen a dramatic rebound after dipping down 15% in the spring, economists have been worrying that the labor market has just been slower to show sensitivity to the tariffs.
New data had shown employers showing signs of hesitancy. Payroll firm ADP found that the private sector lost 33,000 jobs in June, far below the 100,000 increase that was expected, and the first decrease since March 2023.
The dip in job openings doesn't necessarily mean companies are laying off more workers; rather, they are creating fewer new positions.
'Though layoffs continue to be rare, a hesitancy to hire and a reluctance to replace departing workers led to job losses last month,' said Nela Richardson, chief economist at ADP, in a statement.
Data from BLS that measures job openings and turnovers in the labor market found that while job openings had climbed in May, to its highest level since November, the vast majority of openings were concentrated in the leisure and hospitality industry. Economists with Citigroup said the spike in new jobs could be temporary as companies opened new positions in response to Trump's crackdown on immigrants, fearing that immigrant employees could lose work permits.
The White House has spent the last few months downplaying the impact tariffs have on the domestic economy, despite anxiety from both consumers and businesses over the impact tariffs have on prices.
The deadline for Trump's 90-day pause on some of his highest tariffs is scheduled to expire next week, as the White House tries to broker deals with dozens of countries that could face high tariffs.
The White House announced on Tuesday a deal with Vietnam, whose products were scheduled to face a 46% tariff. The country agreed to a 20% tariff rate, with no tariffs placed on US exports. The deal with Vietnam follows deals Trump has made with the UK and China, but there are dozens of other countries whose exports could face high tariffs without a deal.
Amid economic uncertainty, Trump has tried to pass blame onto the Federal Reserve and its chair, Jerome Powell. On Monday, Trump sent an open letter to Powell demanding that the Fed lower interest rates.
'He's costing us a fortune because he keeps the rate way up,' Trump wrote on social media.
Powell, in turn, has said that the Fed has not lowered interest rates because of economic uncertainty caused by Trump's tariffs.
'In effect, we went on hold when we saw the size of the tariffs,' Powell said. 'Essentially all inflation forecasts for the United States went up materially as a consequence of the tariffs.'
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