Choose your settings
Choose your language
Economic News

United States: Job Creation Slows Slightly

July 7, 2023
Francis Généreux
Principal Economist


  • According to the establishment survey, the US economy added 209,000 jobs in June. This comes after an increase of 306,000 in May (revised from 339,000) and 217,000 in April (revised from 294,000).
  • Employment rose 23,000 in construction and 7,000 in manufacturing.
  • Private sector services added 120,000 jobs after an increase of 236,000 in May. Job losses were recorded in retail trade (-11,200), wholesale trade (-3,600) transportation and warehousing (-6,900) and food services (-800). Professional services added just 21,000 jobs. 73,000 jobs were created in education and health care. Public administration added 60,000 jobs.
  • As in May, average hourly earnings ticked up 0.4% in June. They're still up 4.4% compared to a year earlier. Average weekly hours went up slightly from 34.3 to 34.4.
  • The unemployment rate fell from 3.7% in May to 3.6% in June. According to the household survey, employment rose by 273,000 in June after falling by 310,000 in May.


After briefly picking up steam in May, June saw the US labour market record its weakest job growth since December 2019, excluding declines caused by pandemic waves. This lacklustre jobs report, which isn't far off our forecast, also came with downward revisions to previous months' job creation numbers (-77,000 for April and -33,000 for May). It feels like there's been a loss of momentum. The declines seen in several sectors, including retail and wholesale trade, food services and nondurable goods manufacturing (-8,000) are a sign of weakness, as is the loss of 12,600 jobs in temporary help services, which tends to be a leading indicator for the labour market. Additionally, of the 250 industries covered by the establishment survey, the proportion that recorded job growth fell from 61.2% in May to 58.0% in June.

But despite these signs of slowing, the US labour market remains strong. It still managed to pick up 209,000 jobs in June, proving sticky at this stage in the cycle, with the key interest rate up 500 basis points since March 2022. Overall, the US economy added 1,669,000 jobs in the half of 2023. The unemployment rate went down in June, hours worked were up and, crucially, wage growth remained strong—all signs of a still overheated market.


While the US labour market is showing signs of slowing, it remains too tight. We assume Fed officials will share the same opinion when they meet at the end of July, which likely means an end to the brief pause in rate hikes. We expect to see another 25 basis point raise and indications that more could come if needed.