When the U.S. Department of Labor released its June employment figures, it painted a rosy picture of the job market. Employers in the United States reported adding 288,000 jobs in June, which marks the fifth straight month of job growth in excess of 200,000 positions. June growth helped the economy reach several major milestones. In the first half of 2014, average job growth reached 231,000 jobs per month, the highest level since 2006. The unemployment rate hit the lowest level in nearly six years. In addition, the number of long-term unemployed job seekers in the United States dropped to 3.1 million, which is the lowest since February 2009.
The good news for the labor market didn’t stop at the number of new positions added, with other figures signaling a potential take-up of market slack. The median duration of unemployment dropped by one-and-a-half weeks. Another measure of unemployment that takes into account people who would like to work but who are not actively searching for it, as well as people who want to work full-time but only have part-time positions fell, as well, to its lowest level since late 2008. And gains in employment came across multiple industries. Jobs in services leaped by 236,000, and manufacturing, construction, and government all posted modest gains, as well.
Economists have approached the figures with cautious optimism, warning that the job market still shows signs of slack, and as it improves, discouraged job seekers are likely to return, exerting a downward force on wage growth. Average wages grew by only 6 cents an hour in June, and their 12-month gain dropped to 2 percent.
The U.S. job market’s growth has been a relief to economists overall. The year started out with a sharp economic contraction driven by a brutal winter, but job growth continued and economists expect to see it generate dividends later in the year. With the second quarter currently making up for the contraction in the first quarter, the economy is expected to grow at a similar rate in 2014 as it did in 2013.