According to the BLS, in June the US added 223K payrolls, less than the expected 233K, even as the the US unemployment rate dropped to 5.3% from 5.4%. Worse, the previous number was revised from 280K to 254K. Worst of all, average hourly earnings were flat despite expectations of a 0.2%, and a big drop from last month's 0.3%.
So much for escape velocity in payrolls: not only did June disappoint but the last two months were revised lower by 60K.
But the worst news in the report was the average hourly earnings, which were expected to rise by a modest 0.2%, down from last month's 0.3%. Instead they were unchanged at $24.95.
Why? Because wages continue to track the real state of the labor market as shown by the total civilian employment to population ratio, not the ridiculously fabricated headline unemployment number.
And with this data it is now time to cross over the September rate hike from the calendar.
More from the BLS report:
Total nonfarm payroll employment rose by 223,000 in June, compared with an average monthly gain of 250,000 over the prior 12 months. In June, job gains occurred in professional and business services, health care, retail trade, financial activities, and in transportation and warehousing.
Employment in professional and business services increased by 64,000 in June, about in line with the average monthly gain of 57,000 over the prior 12 months. In June, employment continued to trend up in temporary help services (+20,000), in architectural and engineering services (+4,000), and in computer systems design and related services (+4,000).
Health care added 40,000 jobs in June. Job gains were distributed among the three component industries--ambulatory care services (+23,000), hospitals (+11,000), and nursing and residential care facilities (+7,000). Employment in health care had grown by an average of 34,000 per month over the prior 12 months.
Employment in retail trade increased by 33,000 in June and has risen by 300,000 over the year. In June, general merchandise stores added 10,000 jobs.
In June, employment in financial activities increased by 20,000, with most of the increase in insurance carriers and related activities (+9,000) and in securities, commodity contracts, and investments (+7,000). Commercial banking employment declined by 6,000. Employment in financial activities has grown by 159,000 over the year, with insurance accounting for about half of the gain.
Transportation and warehousing added 17,000 jobs in June. Employment in truck transportation continued to trend up over the month (+7,000) and has increased by 19,000 over the past 3 months.
Employment in food services and drinking places continued to trend up in June (+30,000) and has increased by 355,000 over the year.
Employment in mining continued to trend down in June (-4,000). Since a recent high in December 2014, employment in mining has declined by 71,000, with losses concentrated in support activities for mining.
Employment in other major industries, including construction, manufacturing, wholesale trade, information, and government, showed little or no change over the month.
The average workweek for all employees on private nonfarm payrolls was 34.5 hours in June for the fourth month in a row. The manufacturing workweek for all employees edged down by 0.1 hour to 40.7 hours, and factory overtime edged up by 0.1 hour to 3.4 hours. The average workweek for production and nonsupervisory employees on private nonfarm payrolls was unchanged at 33.6 hours. (See tables B-2 and B-7.)