Published: Sun, August 05, 2018
Money | By Armando Alvarado

U.S. unemployment fell to 3.9% in July

U.S. unemployment fell to 3.9% in July

The US economy remains close to full employment even though the number of jobs added last month was below the 195,000 forecast by economists, Efe reported.

The world's largest economy also had a net gain of 157,000 jobs, which is less than the monthly average so far this year.

Employers pulled back on hiring in July, but the job gains were still enough to lower the US unemployment rate a tick to 3.9 percent from 4 percent.

The jobs data released on Friday followed a report that the USA trade deficit widened in June for the first time in four months as exports fell and imports grew.

Typically, businesses raise wages when it's hard to find the talent they want, but annual wage growth remained at a tepid 2.7 percent, the Labor Department said. The unemployment rate slipped to 3.9 percent, from 4 percent, the Labor Department said Friday.

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The unemployment rate has now dipped below 4 percent for the third time this year. "Since Election Day 2016, we have created 3.8 million new jobs". This suggests that the trade disputes between the USA and China are not yet slowing down hiring in manufacturing.

Stocks rose moderately after the report was released.

After remaining elevated for years after the Great Recession, the number of part-time workers who would prefer full-time work has fallen almost 13 percent in the past year and now stands at 4.6 million. That was an improvement over a 4-cent gain in June.

Restaurants, bars and hotels added 40,000 jobs, the most in nine months. The White House has slapped tariffs on steel and aluminium and on $34 billion of imports from China, and several companies have hit USA imports with retaliatory duties. Despite many company executives complaining that they can not find workers to fill open positions, wage growth remains sluggish. Economists were watching manufacturing closely for signs of a drag from the Trump administration's escalation of trade tensions with China and allies. Mining, wholesale trade, transportation and warehousing, information and financial activities remained mostly flat, the BLS said.

"The more you make an employee healthy and happy, the more that they're going to stay with you", England said. The low unemployment rate could allow the Federal Reserve to raise interest rates again in September. That means that, after adjusting for inflation, wage growth actually has slowed from its pace in 2015-16.

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