US job market looks solid 8 years after recession ended

Asia stocks firm as upbeat U.S. European data boosts confidence

Asia stocks firm as upbeat U.S. European data boosts confidence

Payroll processor ADP reported that in a private survey of companies, it found that a hefty 253,000 jobs were added in May, mostly among companies with fewer than 500 workers.

The unemployment rate in America is at a 16-year low.

Despite the slowdown in job growth, the USA economy is running neither too hot nor too cold, with growth holding at a tepid but far from recessionary 2 percent annual rate. A broad measure of unemployment, which includes people who want to work but have given up searching and those working part-time because they can not find full-time employment, fell two-tenths of a percentage point to 8.4 percent, the lowest since November 2007. The jobless rate for Asians was 3.6 percent, for Hispanics 5.2 percent and for blacks 7.5 percent. It plans to open 47 franchises before year's end, adding more than 400 jobs.

The Labor Department said Friday that the unemployment rate fell to 4.3 percent from 4.4 percent.

Prior to the report, USA financial markets had nearly priced in a 25 basis points increase in the Fed's benchmark overnight interest rate this month, according to CME FedWatch. The health care overhaul the administration favors is being reworked in the Senate.

Employment in health care rose by 24,000 in May. The government cut its estimate of new jobs created in April to 174,000 from 211,000.

Transportation and warehousing added 3,600 jobs, with warehousing and storage showing minimum change. We want to hear from you.

The manufacturing sector lost 1,000 jobs in May, breaking a five-month streak of factory job growth.

Those people were not in the labor force, wanted and were available for work and had looked for a job at some time during the prior 12 months. Job gains for March and April were also revised down.

For the year to date, the economy has added +810,000 new jobs, which means average job creation for the year so far now stands at 162,000 per month.

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But the influx of job seekers can also inflict a drag on pay growth.

Though the unemployment rate fell one-tenth of a percentage point to its lowest level since May 2001, that was because 429,000 people dropped out of the labor force.

Wages rose by 4 cents in May, bringing the annual growth rate to 2.5 percent.

The bigger picture is that the jobless rate has fallen by 0.5 percent since the start of the year, with many employers having difficulty finding qualified workers.

"While the Federal Reserve might not be dissuaded from raising interest rates at this month's meeting, the jobs numbers might make the debate at least more vigorous".

Even before the Labor Department's release on Friday morning, the Fed had been sending firm signals that its members viewed the economy as strong enough to withstand another rate increase.

Analysts were split over whether the May report was encouraging or disappointing. Goldman Sachs says the trend will continue to reduce monthly job gains by about 10,000.

David Berson, chief economist for Nationwide, was much more negative.

Republican President Donald Trump, who inherited a strong job market from the Obama administration, has vowed to sharply boost economic growth and further strengthen the labor market by slashing taxes and cutting regulation. 608,000 people dropped out of the labor force between April and May.

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