In July 164,000 jobs got added to the US economy, which continues the trend of a decade-long extension.
According to the US government, the unemployment rate in July was just 3.7%, while the average hourly earnings increased by 3.2% compared to the last year.
The rate of hiring has slowed down a bit this year in part due to a significant percentage of Americans already being employed. At present, the unemployment rate is close to its half-century low.
Even though the current expansion is the longest on the record and the economy is in terrific shape, it has not all been smooth sailing. Trade conflict with China continues to be a concern, especially after President Trump’s announcement of imposing a 10% tariff on $300 billion of Chinese imports from September 1st.
This move can slow down the economic growth if the additional tariffs remain in place for a long time, or if China adopts the tit-for-tat approach. Since the new tariffs will be imposed on a wide array of consumer products, such as laptops, smartphones, and children’s clothing, this move is likely to hit American shoppers more directly than any other move so far.
The Fed has made efforts to prolong the economic expansion, partly because it’s only recently that some of the benefits have started reaching America’s low-income communities. Earlier this week, the Fed reduced its benchmark interest rate by 25 basis points — its first in 11 years — to negate the impact of US-China trade war, weakness of the global economy, and low inflation.
If trade conflicts intensify, both the economy and the job market could experience a slowdown. However, for now, things look bright, and the economy is in a really sweet spot.
Over the course of the last six months, 141,000 jobs have been added monthly on average. In July, several industries posted great numbers. Over 30,000 jobs were added in healthcare and nearly 14,000 in the finance and insurance industry. Local governments posted substantial gains of 14,000 jobs, while restaurants and bars created more than 15,000 jobs. July proved to be a good month for the manufacturing sector too, adding 16,000 jobs to the US economy.