An early look at June U.S. jobs data suggests pickup, not slump
2022.06.23 01:11
A “Now hiring” sign is displayed on the window of an IN-N-OUT fast food restaurant in Encinitas, California, U.S., May 9, 2022. REUTERS/Mike Blake
(Reuters) – An early look at the state of the U.S. job market in June from payroll provider UKG suggests some strengthening, even as the Federal Reserve lifts interest rates sharply and economists raise alarms over the likelihood of a recession.
Workforce activity increased slightly in the first two weeks of the month, according to the firm which tracks shift work in real time. It mostly declined during the prior three months.
Particularly notable, the firm said, was an increase in demand for workers in retail, the first such increase since the start of the year.
That could be good news for Fed Chair Jerome Powell. On Wednesday he told U.S. lawmakers the Fed was committed to bringing down too-high inflation, with a plan to raise borrowing costs high enough that demand for labor, goods and services subsides to levels more in line with supply.
Continued strength in the labor market casts doubt on the view of those like former New York Fed President Bill Dudley who say a recession in the next year or so is inevitable. And it may provide some grist for Fed policymakers who believe a soft landing for the economy is possible, if difficult.
Powell on Wednesday said he does not see current recession risks as being particularly elevated, though a downturn will be “challenging” to avoid, especially because so many of the factors putting upward pressure on prices are beyond the Fed’s control, such as Russia’s war and China’s COVID-19 lockdowns.
But Powell also said he believes the labor market is “unsustainably hot,” suggesting that he would welcome some cooling.
The U.S. Labor Department releases its jobs monthly report in on July 8.
