June Sees Tepid Job Growth

July 8, 2005 (PLANSPONSOR.com) - Domestic hiring was decidedly lackluster in June as companies brought on 146,000 new workers over the month, shy of analysts' expectations.

The US Department of Labor (DoL) also reported Friday that June’s unemployment rate dipped from 5.1% in May to 5% – largely because of the small number of Americans joining the workforce. The DoL also issued revised job figures for April and May, boosting April’s employment growth to 292,000 and May’s to 104,000 respectively. That is a combined 44,000-job hike over the initial data.

Analysts had expected to see 188,500 new jobs in June, Reuters reported.

According to the DoL data, factory payrolls shrank for the fourth straight month as auto assembly and parts plants cut back on production. Some 96,000 manufacturing jobs have been lost since August 2004.

While 18,000 workers were hired in the construction industry last month, most of June’s employment growth occurred in the service sector, the government said. Professional and business services jobs rose 56,000, education and health services were up 38,000, and leisure and hospitality payrolls advanced by 19,000.

The growth in the professional and business services sector follows little change in May. However, this industry has gained nearly a half million jobs over the year.  Within the industry, architectural and engineering services employment rose by 9,000 in June.  Temporary help services employment was little changed, the DoL said.

Health care employment continued to grow in June, rising by 25,000.  Over the year, the health care industry has added 249,000 jobs.  In June, job growth was concentrated in hospitals (12,000) and ambulatory health care services (11,000).
Among other service-providing industries, financial activities employment edged up over the month, as credit intermediation and real estate showed continued strength.  Employment in food services edged up in June after showing
  little change in May, the DoL said. Employment in child day care services rose by 8,000 on a seasonally adjusted basis in June, as layoffs were lighter than usual.

Employment in warehousing and storage rose by 6,000.  Air transportation continued to lose jobs, declining by 3,000 over the month.