In June, the economy added a disappointing 223,000 payroll jobs and the more optimistic gains for May were substantially revised downwards from 280,000 to 254,000, on top of downward revisions for April. While the official unemployment rate dropped to 5.3 percent, the prime-age employment-to-population ratio continued to be stuck in the doldrums at 77.2 percent. Given the continued slack in the labor market, it is not surprising that nominal average hourly earnings only rose by an unimpressive 2.0 percent over the year: unfortunately, it is clear that the economy is continuing to leave workers high and dry. In light of this jobs report, it is more than obvious that the Federal Reserve needs to stay the course–if they act too soon, they will take the remaining wind out of the economy’s sails.
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