The US economy has created more jobs than expected in June

The U.S. economy added 213,000 jobs in June, as unemployment rose to 4 percent

US jobs growth stronger than expected

The Labor Department reported Friday that the nation's unemployment rate rose by 0.2 of a percentage point in June, to 4 percent.

The 213K rise in positions beat market expectations for 195k new jobs, though the market was expecting the unemployment rate to stay steady.

Despite strong hiring, wage growth remained sluggish, and was effectively erased by inflation: average hourly earnings rose just 0.2 per cent to US$26.98, putting wages up 2.7 per cent over the same month past year, the same as the 2.7 per cent rise in the Consumer Price Index.

Manufacturers hired 36,000 workers in June, the most in six months, adding to the 19,000 jobs created in May. That will keep pushing down the jobless rate, says Ian Shepherdson of Pantheon Macroeconomics.

Meanwhile, the revisions for the two previous months - April and May - looked encouraging, with a combined gain of 37,000 jobs as compared to previous BLS reports.

Despite the small bump in unemployment, a decade of steady job growth following the Great Recession has pushed unemployment to the lowest level in decades. But the average was skewed downward in June because the job seekers were mainly those with only a high school education or less, who are generally paid lower wages, Barrera noted. Job growth occurred in professional and business services, manufacturing, and health care, while retail trade lost jobs.

A worker cuts a piece from a steel coil at the Novolipetsk Steel PAO steel mill in Farrell, Pennsylvania, U.S., March 9, 2018.

The unemployment rate rose to 4 percent, the Labor Department said June 6.

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"There's definitely still a lot of room for the labour market to absorb the slack", Kevin Hassett, chairman of the White House Council of Economic Advisers, said on Bloomberg Television. Over the past year, average monthly payroll gains have hovered around 200,000, and hiring has been running ahead of growth in the labor force.

Economists had predicted 195,000 payroll gains amid a shortage of available workers to fill jobs.

The sluggish wage growth is made worse by rising inflation rates eating away at take-home pay.

"This report was more than enough to seal the deal on a July rate hike from the Bank of Canada", said Frances Donald, a senior economist with Manulife Asset Management.

With a record 6.7 million unfilled jobs in April, economists are optimistic that wage growth will accelerate later this year. "We continue to closely monitor a range of factors, from yesterday's Fed minutes to the potential global impact of tariffs to the Treasury yield curve, and we are encouraged by numbers like those in today's report". That continues as employers consistently hire at robust rates and the unemployment rate keeps falling.

Businesses hired robustly in June despite threats of trade tensions.

Employment gains were broad-based as the private sector added 202,000 jobs, and federal, state and local governments added 11,000.

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