# U.S. job growth picks up in June; unemployment rate rises to 5.9% Author: Pal Sinha, Barnali Author URL: https://financedigest.com/author/pal-sinha-barnali Published: 2021-07-02 Category: BUSINESS Category URL: https://financedigest.com/category/business Meta Title: US job growth accelerates in June as companies raise wages Meta Description: Learn about the latest US job growth report for June, with companies raising wages and offering incentives to attract workers back into the labour force. URL: https://financedigest.com/u-s-job-growth-picks-up-in-june-unemployment-rate-rises-to-5-9html ![undefined](https://prod.superblogcdn.com/site_cuid_cm5qst7v3003gwirgwqtxn8i8/images/2021-07-02t123631z1lynxnpeh610o7rtroptp4usa-economy-1736838234954-compressed.jpg) By Lucia Mutikani WASHINGTON (Reuters) – U.S. job growth accelerated in June as companies, desperate to boost production and services amid booming demand, [raised wages and offered incentives to draw millions](https://www.financedigest.com/ride-hailing-app-cabify-raises-110-million-for-expansion-in-latam-spain.html "Ride-hailing app Cabify raises 0 million for expansion in LatAm, Spain") of reluctant unemployed Americans back into the labor force. Nonfarm [payrolls increased by 850,000 jobs last month after rising](https://www.financedigest.com/instant-view-us-may-payrolls-rise-up-than-expected.html "Instant View: US May payrolls rise up than expected") 583,000 in May, the Labor Department said in its closely watched employment report on Friday. The [unemployment rate](https://www.financedigest.com/u-s-job-growth-powers-ahead-unemployment-rate-at-3-4.html "U.S. job growth powers ahead; unemployment rate at 3.4%") rose to 5.9% from 5.8% in May. The [jobless rate](https://www.financedigest.com/russian-retail-sales-fall-deeper-jobless-rate-rises-in-sept-data.html "Russian retail sales fall deeper, jobless rate rises in Sept – data") has been understated by people misclassifying themselves as being “employed but absent from work.” There are a record 9.3 million job openings. Economists polled by Reuters had forecast payrolls advancing by 700,000 [jobs last month and the unemployment rate](https://www.financedigest.com/italy-jan-jobless-rate-edges-up-to-7-9-with-35000-jobs-created.html "Italy Jan jobless rate edges up to 7.9%, with 35,000 jobs created") dipping to 5.7%. Average hourly earnings rose 0.3% [last month](https://www.financedigest.com/monkeypox-emergency-could-last-months-with-window-closing-to-stop-spread-experts-say.html "Monkeypox emergency could last months, with window closing to stop spread, experts say") after increasing 0.4% in May. That raised the year-on-year [increase in wages](https://www.financedigest.com/greece-to-increase-minimum-wage-again-before-election.html "Greece to increase minimum wage again, before election") to 3.6% from 1.9% in May. [Annual wage growth](https://www.financedigest.com/automotive-gas-charged-shock-absorbers-market-worth-will-reach-us-2-9-bn-in-2021-grow-at-overall-compound-annual-growth-rate-cagr-of-5-0-between-2021-and-2031.html "Automotive Gas Charged Shock Absorbers Market worth will reach US$ 2.9 Bn in 2021, grow at overall compound annual growth rate (CAGR) of 5.0% between 2021 and 2031") was in part flattered by so-called base effects following a big drop last June. The report suggested the economy closed the second quarter with strong growth momentum, following a [reopening made possible by vaccinations against COVID-19](https://www.financedigest.com/freedom-day-sydney-reopens-as-australia-looks-to-live-with-covid-19.html "‘Freedom Day’: Sydney reopens as Australia looks to live with COVID-19"). More than 150 million people are fully immunized, [leading to pandemic-related restrictions on businesses](https://www.financedigest.com/covid-19-is-impacting-the-variable-speed-drive-market-size-business-revenue-forecast-leading-competitors-and-growth-trends-2028.html "COVID-19 Is Impacting The Variable Speed Drive Market | Size, Business Revenue Forecast, Leading Competitors And Growth Trends 2028") and mask mandates being lifted. Politicians, [businesses and some economists have blamed enhanced unemployment benefits](https://www.financedigest.com/how-choosing-the-right-mtd-for-vat-software-can-maximise-business-benefits.html "How choosing the right MTD for VAT software can maximise business benefits"), including a $300 weekly check from the government, for the labor crunch. Lack of [affordable child care](https://www.financedigest.com/hair-care-shouldnt-break-the-bank-transplant-surgery-should-be-accessible-and-affordable-for-all-men.html "Hair-Care Shouldn’t Break The Bank – Transplant Surgery Should Be Accessible and Affordable For All Men") and fears of contracting the coronavirus have also been blamed for keeping workers, mostly women, at home. There have also been pandemic-related retirements as well as career changes. Economists generally expect the labor supply squeeze to [ease in the fall](https://www.financedigest.com/oil-falls-as-earthquake-impact-on-crude-eases-rate-hike-fears-rise.html "Oil falls as earthquake impact on crude eases, rate hike fears rise") as schools reopen and the government-funded unemployment benefits lapse but caution many unemployed will probably never return to work. Record-high stock prices and surging home values have also encouraged [early retirements](https://www.financedigest.com/how-to-retire-early.html "How to retire early"). According to [job search engine](https://www.financedigest.com/machine-learning-engineer-jobs.html "Machine learning engineer jobs") Indeed, 4.1% of jobs postings advertised hiring incentives through the seven days ending June 18, more than double the 1.8% share in the week ending July 1, 2020. The incentives, which included signing bonuses, retention bonuses or one-time cash payments on being hired, ranged from as low as $100 to as high as $30,000 in the [month ended](https://www.financedigest.com/global-stocks-trade-higher-at-the-end-of-a-volatile-month.html "Global stocks trade higher at the end of a volatile month") June 18. Some restaurant [jobs are paying](https://www.financedigest.com/best-paying-jobs-in-industrial-specialties.html "Best paying jobs in industrial specialties") as much as $27 per hour plus tips, according to postings on Poachedjobs.com, a national job board for the restaurant/hospitality industry. The federal minimum wage is $7.25 per hour, but is higher in some states. With employment not expected to return to its pre-pandemic level until sometime in 2022, [rising wages are unlikely to worry Federal Reserve officials even as inflation](https://www.financedigest.com/oil-rises-about-2-with-u-s-and-china-inflation-in-focus.html "Oil rises about 2% with U.S. and China inflation in focus") is heating up because of supply constraints. [Fed Chair Jerome Powell has repeatedly stated he expects high inflation](https://www.financedigest.com/stocks-tumble-dollar-rallies-as-soaring-u-s-inflation-implies-an-aggressive-fed.html "Stocks tumble, dollar rallies as soaring U.S. inflation implies an aggressive Fed") will be transitory. The U.S. [central bank last month opened talks on how to end](https://www.financedigest.com/testing-waters-hungarys-central-bank-flags-cut-in-top-end-of-rate-corridor.html "Testing waters, Hungary’s central bank flags cut in top end of rate corridor") its crisis-era massive bond-buying. (Reporting by Lucia Mutikani; Editing by Dan Burns and Chizu Nomiyama) --- This blog is powered by Superblog. Visit https://superblog.ai to know more. ---