One day after President Donald Trump’s “Salute to America” which included showing of the United States’s military hardware, and a rousing speech to the nation from the president himself, the monthly jobs report from the Department of Labor was released.
To put it mildly, President Trump is making America great again using business and economics as the driver.
Payroll growth rebounded sharply in June as the U.S. economy added 224,000 jobs, the best gain since January and running contrary to worries that both the employment picture and overall growth picture were beginning to weaken. The unemployment rate edged up to 3.7% as labor force participation rose, according to the Labor Department.
Economists surveyed by Dow Jones had expected nonfarm payrolls to rise by 165,000 and the unemployment rate to hold steady at 3.6%. May’s initially reported growth of 75,000 had raised doubts about the durability of the record-setting expansion that began a decade ago. The May count was revised lower to 72,000….
Professional and business services led the job gains with 51,000, while health care added 35,000 and transportation and warehousing contributed another 24,000. Construction also added 21,000 and manufacturing, despite teetering on contraction recently, saw another 17,000 jobs added, above the 8,000 per month average in 2019 and getting closer to the 22,000 a month in 2018.
The reality that this is summer, and leisure and recreation jobs are most likely included in the numbers, aside, this is very good news. It means that more Americans are earning a paycheck than were when President Trump took office.
The news was not anticipated to be this good, and in fact, the stock market opened down from the close on Wednesday which may also be related to the widely held assumption that the Federal Reserve Bank is going to raise interest rates. The news had an immediate impact.
Market reaction shifted abruptly after the Bureau of Labor Statistics release. Traders moved the possibility of a 50-basis point cut to 8% from nearly 30% though 100% expectations for a quarter-point cut remained firmly in place.
President Donald Trump has been sharply critical of the Fed and repeated his previous sentiments later in the morning.
“We don’t have a Fed who knows what they’re doing,” Trump said, adding, as he has in the past, that the economy would take off like a “rocket ship” with lower interest rates.
That is obviously what the president wants. The question is will the Federal Reserve give that idea the time of day.