The US Economic Slowdown Is Looking More Threatening
Worrying signs in the labor market mean the Fed’s July meeting will point to policy easing sooner rather than later.
People line up at the a job fair in Florida.
Photographer: Joe Raedle/Getty Images
On the surface, the US employment report for June looked pretty good. Some 206,000 jobs were added, which exceeded the 190,000 median estimate of more than five dozen economists surveyed by Bloomberg. Also, wage growth continued to moderate, easing concern that fast-rising earnings would underpin inflation. But peel back the curtains and you can clearly see why so many are worried the soft patch that the economy seems to have run into may get even softer — or worse.
The best place to start is with the revisions to recent monthly labor data. The Labor Department said 111,000 fewer jobs were created in April and May than originally reported. What that means is that monthly payrolls expanded by an average of 177,000 in the second quarter, down from 267,000 in the first three months of the year.