US adds a solid 213,000 jobs; unemployment up to 4 pct

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US employers kept up a brisk hiring pace in June by adding 213,000 jobs in a sign of confidence despite the start of a potentially punishing trade war with China.

The labour force expanded by 75,600 in June, the biggest one-month increase in six years, Statistics Canada reported Friday from Ottawa.

In spite of the tightening labor market, however, wage growth remains anemic.

The increased participation combined with a lack of accelerating wage growth during June indicates a labor market that still has enough slack remaining to pull in new workers who had been disengaged from the workforce.

The unemployment rate in June fell back slightly to 4.0% from 3.8% in May.

Steady hiring and low unemployment shows the labor market continues to be an area of strength for the economy since the recession ended nine years ago. On the same day as the release of June's jobs report, the US and China are imposing duties on more than $30 billion-worth of each other's goods.

The broader US economy appears sturdy.

Job growth this year has been faster than in 2017.

The report showed that Canada's trade surplus with the USA narrowed to $3.3 billion in May, from $3.7 billion April, as more imports headed north across the border and south-bound exports decreased.

Nonetheless, an escalating trade war poses a clear threat.

Michael Gapen, chief USA economist at Barclays Plc in NY and a former Fed official, said that the boost in workers coming into the labour market bodes well for pushing down the unemployment rate again.

America's labour market boomed again last month, strengthening the case for the Federal Reserve to raise interest rates twice more this year.

The national jobless rate climbed 0.2% last month. "Over the year, average hourly earnings have increased by 72 cents, or 2.7 percent", BLS said on Friday.

Jim O'Sullivan, chief USA economist at High Frequency Economics, said gains have averaged 215,000 month so far this year, up from 182,000 "more than strong enough to keep the unemployment rate trending down over time".

Ahead of this morning's new jobs report, most projections pointed to totals of roughly 200,000 new jobs last month.

The professional and business services sector added 50,000 new positions, manufacturing rose by 36,000, while the fabricated metals industry, which is at the heart of Trump's current trade battle, added 7,000 new workers. Additionally, the Trump administration has drawn attention to the record-low of African American unemployment, even as it remained higher than the overall rate at 5.9%. Asian unemployment increased to 3.2 percent from an extraordinary 2.1 percent in May.

The average workweek for all employees on private nonfarm payrolls was unchanged at 34.5 hours in June.

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