The U.S. economy added more-than-expected new jobs last month, the Labor Department said Friday, while wages came in just below forecasts, adding upside momentum for stocks heading into the trading session.
The Bureau for Labor Statistics said 850,000 new jobs were created last month, lead by gains in leisure and hospitality, with headline unemployment rate edging higher, to 5.9% from 5.8%. The May tally was 150,000 above the market forecast of 700,000.
The BLS also revised its May jobs addition estimate to 583,000 from 559,000 and noted that hourly wages were up 0.3% on the month, and 3.6% on the year in June, with both figures coming in shy of Street forecasts.
"Overall, this report signals incremental progress in the pace of job growth, but there’s no sign yet of a shift back into the labor force," said Ian Shepherdson of Pantheon Macroeconomics. "The missing millions are still missing, but it’s too soon to see any impact of the early ending to the $300 per week unemployment benefit uplift in a few states."
"It’s reasonable to expect a modest shift back into the labor force in July and August as more states cut off the benefit, but when the federal money runs out on September 6, about 70% of unemployed people will still be receiving the uplift," he added. "In any event, we don’t know the extent to which other forces, like childcare problems, are keeping people out of the labor force, though we do know that participation has been weakest over the past year in the child-rearing and grandparent-age cohorts."
U.S. equity futures jumped higher following the data release, with contracts tied to the Dow Jones Industrial Average indicating a 70 points opening bell gain and those linked to the S&P 500 priced for an 11 point bump.
Benchmark 10-year note yields, meanwhile, eased tp 1.434%.
Earlier this week, a reading of private sector job growth from payroll provider ADP indicated a stronger-than-expected 692,000 new positions were created last month, but also cut 92,000 from its May tally, which was revised to 886,000.
The Labor Department's tally of weekly jobless claims fell to a post-pandemic low of 364,000 for the period ending June 26 .