U.S. Employment Shows Continued Growth But Falls Short Of Estimates

(RTTNews) - After reporting a sharp jump in U.S. employment in the previous month, the Labor Department released a report on Friday showing that employment rose by less than expected in the month of July.

The report said non-farm payroll employment increased by 209,000 jobs in July after jumping by an upwardly revised 298,000 in June.

Economists had been expecting employment to climb by about 233,000 jobs compared to the increase of 288,000 jobs originally reported for the previous month.

Paul Ashworth, Chief U.S. Economist at Capital Economics, said, "It is a sign of how far the US economy has come in recent months that the 209,000 increase in non-farm payroll employment in July will probably be viewed as a disappointment."

Despite the continued job growth, the Labor Department also said the unemployment rate unexpectedly edged up to 6.2 percent in July from a nearly six-year low of 6.1 percent in June.

However, the uptick by the unemployment rate was largely due to an increase in the size of the labor force, which rose by 329,000.

The Labor Department said the civilian labor force participation rate inched up to 62.9 percent in July from 62.8 in June.

The continued job growth in July was partly due to the addition of 47,000 jobs in the professional and business services sector, although that is down from 73,000 in the previous month.

Notable job growth was also seen in several other sectors, including the manufacturing, retail, construction and healthcare sectors.

Meanwhile, the report also showed that average hourly employee earnings edged up by a penny to $24.45 in July. Compared to the same month a year ago, average hourly earnings were up by 2.0 percent.

"Despite the strength of employment gains and the decline in the unemployment rate, there is still no sign of an acceleration in average hourly earnings," Ashworth said.

He added, "Nevertheless, survey-based indicators point to a pick-up in wage growth soon and other measures, such as the employment cost index and compensation per employee hour, already show the beginnings of an acceleration in their growth rates."