The Labor Department reported Friday morning that the U.S. added 195,000 jobs in June, outpacing economist predictions while estimates of the previous two months were also upwardly revised, hinting the economy didn’t slow as much as thought to end the first half of the year.
The unemployment rate remained at 7.6 percent in June from May, according to the report.
Economists were expecting 158,000 new jobs in June and the unemployment rate to tick down to 7.5 percent. The number of people seeking work remains strong, keeping pressure on the unemployment rate. In May, 420,000 people entered the workforce, which caused the unemployment rate to rise 0.1 percent from the 7.5 percent rate in April.
For May, the number of jobs created was revised from 175,000 to 195,000. April’s figure was taken upward from 149,000 to 199,000.
The markets were eagerly awaiting the report as a barometer of the health of the nation and also as to how it pertains to the Federal Reserve’s decision of continuing its stimulus efforts. The Fed currently buys $85 billion per month in Treasuries and mortgage-backed securities as part of “QE3,” but has said that if the economy continues to show strength, that they may begin to taper the programs as early as September. Fed Chairman Ben Bernanke said two weeks ago that QE3 could end in mid-2014, a time when the central bank expects unemployment rate to be at 7 percent.
The better-than-expected report lends to the Fed taking its foot off the gas for its aggressive stimulus practices. Still, though, the hiring pace slowed slightly in the second quarter compared to the first three months of 213. In the first quarter, the employers added an average of 207,000 jobs each month. From April through June, 195,000 jobs were created each month on average.
Over the last 12 months, the U.S. has averaged adding 182,000 jobs per month.
The leisure and hospitality segment paced jobs additions in June, chipping in 75,000 new jobs. Jobs in the category, which includes the likes of bars, hotels, gambling, amusement parks and restaurants, have averaged 55,000 new jobs in 2013, almost twice the 30,000-per-month pace in 2012.
Employment in professional and business services rose by 53,000 in June. Retail trade employers added 37,000 jobs, while health care added 20,000 jobs during the month.
The government continued to shed employees, declining by 5,000 jobs in June to run the 12-month total of lost jobs to 65,000.
Average hourly earnings for private, nonfarm workers rose by a dime to $24.01. In the last year, hourly earnings are up by 2.2 percent, or 51 cents.
Wall Street likes the jobs report to return to trading after the July 4 holiday in the green. In early Friday trading, the Dow Jones Industrial Average is ahead by 82 points, the S&P 500 is up 10 points and the Nasdaq has climbed 20 points. If the gains hold, all three benchmark indexes will post gains in excess of 1 percent for the week.