The job market in U.S. seems to be looking up as a new report suggests that unemployment rates in the country have dropped to 6.1 percent.
On Thursday, July 3, a report from the U.S. Bureau of Labor Statistics revealed the decline in unemployment. The report also revealed that payrolls showed an increase by 288,000 in June, beating expectations of economists. The job gain was fueled by "employment growth in professional and business services, retail trade, food services and drinking places, and health care."
"In June, the unemployment rate declined by 0.2 percentage point to 6.1 percent. The number of unemployed persons decreased by 325,000 to 9.5 million. Over the year, the unemployment rate and the number of unemployed persons have declined by 1.4 percentage points and 2.3 million, respectively," per the report.
The unemployment rate has slid from 6.3 percent in May and is the lowest since before the strike of the financial crisis. The stock markets showed approval in response to the news of unemployment rates dropping to 6.1 percent with the Dow Jones industrial average growing 92 points and hitting an all-time high to top 17,000.
"This has now become a textbook jobs expansion," says Patrick O'Keefe, director of economic research at the consultancy CohnReznick. "It is both broad and accelerating."
The increase in employment opportunities is a clear indication of the steady improvement and revival of the U.S. economy (after shrinking at a steep 2.9 percent annual rate in Q1 2014) post the economic downturn in 2008.
According to the report, in the last three months, the growth in employment has averaged at 272,000 per month. In June, those in professional and business services saw an employment growth of 67,000, retail trade saw an increase of 40,000, healthcare accounted for a 21,000 increase and food and drinking services saw an employment growth by 33,000.
Moreover, factories added around 16,000 workers, financial and insurance firms employed 17,000 more people and retailers 40,200. Construction, by comparison, showed a slower recovery adding only 6,000 employees.
Despite the drop in unemployment, the million-dollar question now is: Will the increased hiring efforts also result in better incomes for job seekers? Market experts are of the opinion that the wages may see a sharp increase eventually owing to the drop in unemployment. However, when this will happen is anybody's guess.
