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Published: Sun, July 10, 2016
Economy | By Melissa Porter

Big rebound: 287000 jobs added in June

Big rebound: 287000 jobs added in June

But the signs of strength in the economy precede Britain's stunning vote last month to leave the European Union.

The much better-than-expected numbers gave a boost to markets in the USA and Europe, which have been battered down by worries that Britain's vote to withdraw from the European Union will drag down economic growth. The PayScale Index, which tracks the change in wages of employed US workers, forecasts a 1.6 percent year-over-year increase in pay for the third quarter of 2016.

Over the last 12 months, the overall economy has created 2.45 million new jobs, which is a pretty healthy number, and if the current pace keeps up, we're on track to create more than 2 million jobs in 2016, despite May's terrible totals.

The unemployment rate, meanwhile, increased from 4.7 percent in May to 4.9 percent in June as more people entered the labor force, the Labor Department said.

June's hiring levels boosted the monthly average of the last three months to a solid 147,000, which economists say is at least adequate to keep up with the steady increase in the size of the U.S. workforce. That took the year-on-year gain in earnings to 2.6 per cent from 2.5 per cent in May. Hiring in 2016 will likely not be as strong as seen a year ago, he said. But given the United States central bank's desire to wait on more data to assess the economic impact of Britain's stunning vote last month to leave the European Union, it probably will not have an impact on the near-term outlook for interest rates. "Or perhaps it is a function of low inflation expectations and low productivity, which restricts the ability or desire of businesses to raise wages". The unemployment rate rose from 4.7 percent to a still-low 4.9 percent.

The Atlanta Fed is now forecasting the United States economy growing at a 2.4 percent pace in the second quarter. That loss helped to offset an increase in May, but the the number of individuals, who would have preferred full-time employment, were working part time because their hours had been cut back or because they were unable to find a full-time job is still far too high. Wage growth picked up to 2.6%.

Employment in professional and business services continued to trend up in June, gaining 38,000 jobs.

Healthcare added 39,000 jobs over the month. The return of 35,100 Verizon workers, who were excluded from May's payroll count while on a month-long strike, boosted information sector employment last month. Labor Secretary Perez says he would expect to see improving wage growth even as jobs creation slows.

In May the unemployment rate had fallen from 5.0 percent to 4.7 percent after the volatile data showed a huge number of people had dropped out of the labor force.

The Bureau of Labor Statistics (BLS) tracked very slow employment growth since the economy began recovering from the last recession.

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