In June, the U.S. private sector saw an addition of 150,000 jobs with an annual wage growth of 4.9%, indicative of a strong recovery in the job market despite the pandemic’s lasting effects, according to the Stanford Digital Economy Lab’s report. However, this growth was not evenly distributed across all sectors or geographic locations.
Employers in the technology and healthcare industries witnessed the largest increases, whereas retail and hospitality – the sectors harshly affected by the pandemic, struggled with slower job growth. Cities showed a quicker recovery than rural areas. Employers are now forced to raise wages in a bid to attract and keep workers amid competition in the tough labor market.
Experts predict strong wage growth and more job opportunities as the economy proceeds to reopen, but they also warn against potential challenges associated with matching job seekers’ skills with job positions’ requirements. Furthermore, support for workers and businesses still grappling in their sectors is emphasized for a sustainable recovery.
Using real-time, anonymized payroll data from 25 million workers, the study provided a wide view of the labor force within the private sector. It helps policymakers, economists, and business leaders make informed decisions benefiting the economy and society.
US private sector’s uneven job growth amid pandemic
Insights based on recent economic policies impact on earnings and job retention were also drawn from the data.
The number of jobs added was lower than expected in June, signaling that the U.S. employment market might be nearing a standstill. Economists, however, remain hopeful of a second-half rebound. In June, significant hirings were recorded in leisure and hospitality, construction, professional and business services, healthcare and social assistance, and retail trade sectors.
June saw fewer job cuts with a 23.6% drop from May as employers announced layoffs totaling 48,786 positions. Interestingly, this figure represents a 19.8% increase from June of last year. The U.S. goods and services deficit grew to $75.1 billion in May, while the U.S. unemployment rate increased slightly to 5.9% in June amid an upswing in the Consumer Price Index by 0.6%.
Both the U.S. and Canada continue to face challenges in their recovery from the pandemic-induced recession, with minor increases in unemployment rates and Consumer Price Indexes. However, the Federal Reserve and the Bank of Canada expressed their continued supportive monetary policies to stimulate economic recovery. Furthermore, both countries reported promising progress in vaccination rates, giving hope for a stronger tailwind for their economies in the future.
