Solid Job Gains in June

Despite interest rate hikes, job growth remained solid in June. Total nonfarm payroll employment increased by 372,000 and the unemployment rate remained at 3.6% in June.

Construction industry employment (both residential and non-residential) totaled 7.7 million and has exceeded its February 2020 level. In June, residential construction lost 4,100 jobs, and non-residential construction added 16,500 jobs. Residential construction employment currently exceeds its level in February 2020, while 79% of non-residential construction jobs lost in March and April have now been recovered.

In June, total nonfarm payroll employment increased by 372,000, following a gain of 384,000 in May, as reported in the Employment Situation Summary.  The estimates for the previous two months were revised down, suggesting modestly softening in labor market. The April estimate was revised down by 68,000 from +436,000 to +368,000, while the May increase was revised down by 6,000 to +384,000. With these revisions, employment in April and May together were revised down by 74,000 from the previously reported ones.

In the first half of 2022, more than 2.7 million jobs were created, and monthly employment growth averaged 457,000 per month. As of June 2022, total nonfarm employment is 524,000 lower than its pre-pandemic level in February 2020, almost fully recovered from the COVID-19 pandemic.

Meanwhile, the unemployment rate remained at 3.6% for the fourth straight month. It was 11.1 percentage points lower than its recent high of 14.7% in April 2020 and 0.1 percentage point higher than the rate in February 2020.

The labor force participation rate, the proportion of the population either looking for a job or already with a job, ticked down 0.1 percentage point to 62.2% in June. The decline in the participation rate was led by Black and Asian workers, while the labor force participation rate for White workers remained the same. The labor force participation rate for people who aged between 25 and 54 decreased 0.3 percentage points to 82.3% in June.

Additionally, according to the Household Survey supplemental data, which come from questions added to the Current Population Survey (CPS) since May 2020, 7.1% of employed persons teleworked or worked at home in the last 4 weeks specifically because of the coronavirus pandemic in June, down from 7.4% in the previous month. The share of the employed who teleworked has declined for the past five months. Two years ago, in May 2020, 35.4% of employed persons teleworked because of the coronavirus pandemic.

Professional and business services (+74,000), leisure and hospitality (+67,000), and health care (+57,000) had notable job gains in June.

Employment in the overall construction sector increased by 13,000 in June, following a 34,000 gain in May. Residential construction lost 4,100 jobs, while non-residential construction employment gained 16,500 jobs in June.

Residential construction employment now stands at 3.2 million in June, broken down as 899,000 builders and 2.3 million residential specialty trade contractors. The 6-month moving average of job gains for residential construction was 9,467 a month. Over the last 12 months, home builders and remodelers added 121,400 jobs on a net basis. Since the low point following the Great Recession, residential construction has gained 1,171,700 positions.

In June, the unemployment rate for construction workers declined by 0.5 percentage points to 3.6% on a seasonally adjusted basis. It marks the lowest rate since May 2019. The unemployment rate for construction workers has been trending lower, after reaching 14.2% in April 2020, due to the housing demand impact of the COVID-19 pandemic.

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