Non-Farm Payrolls Add 224K Jobs In June

There's still time to cancel your rate-cut party. Nonfarm payrolls shot 224,000 higher in June and well beyond Econoday's consensus range where the high forecast was 205,000. There are no flukes in this report underscored by a 17,000 jump for what has been an uneven manufacturing sector that Federal Reserve policy makers are watching with concern. Payrolls at professional & business services jumped 51,000 as employers scramble to meet demand with contractors. Government payrolls, up 33,000, were also a large contributor to June's growth.

The unemployment rate edged higher to 3.7 percent but reflected not weakening for the labor force but strengthening as new comers are looking for jobs. The participation rate rose 1 tenth to 62.9 percent to also beat out expectations.

Wage news shouldn't be alarming for Fed policy makers. A 0.2 percent monthly gain, which missed expectations, is offset at least in part by an upward revision to May which now stands at 0.3 percent. The year-on-year rate, at 3.1 percent, also missed expectations.

The strength of June's payroll growth, which is back over 200,000 for only the second time in five months, helps offset a bumpy run for the labor market this year and will help restore confidence that the US economy, slowing global trade or not, continues to perform well, showing solid growth without inflation. One of the only bits of bad news in today's report is a yet another decline, this time 6,000, for retail which is hemorrhaging jobs this year.