July 2, 2026
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Private sector employment rose by 49 thousand in June after climbing by 97 thousand in May and 150 thousand in April. In the past three months payroll employment has risen on average by 99 thousand per month .The labor market has strengthened somewhat in recent months.
In addition to hiring workers employers can also alter the length of the workweek for their existing workers. The nonfarm workweek was unchanged in June at 34.3 hours after having been unchanged in May. The workweek has been alternating between 34.2 and 34.3 hours for the past two years. Furthermore, prior to the recession the nonfarm workweek was averaging 34.4 hours so it is currently just a snitch shorter than it was six years ago.
Job openings have fallen from a record high level of 11.7 million in early 2021 to 7.6 million. Prior to the recession there were about 7.0 million job openings per month versus 7.6 million currently. Today there are 1.0 job openings for every unemployed worker which is essentially where they were prior to the recession.
The change in employment and hours worked are reflected in the aggregate hours index which rose 0.1% in June to 116.8 after having risen 0.1% in May and 0.3% in April. This index rose 1.3% in the second quarter which, given an assumed 0.7% increase in productivity should result in GDP growth of about 2.0% in the second quarter.
Construction employment rose 11 thousand. Manufacturing employment increased by 3 thousand. Retail trade jobs declined 7 thousand. Transportation and warehousing rose 2 thousand. Info tech jobs fell 9 thousand. Financial sector jobs were unchanged.. Professional and business service sector employment rose 36 thousand. Health care jumped by 22 thousand. Jobs in social assistance rose 25 thousand. Jobs in the leisure and hospitality industry declined by 61 thousand. Government jobs rose by 8 thousand. (Federal government employment rose by 2 thousand in June.)
We expect GDP growth of 2.0% in the second quarter and 2.3% growth for the year.
Stephen Slifer
NumberNomics
We have seen a change in the way companies are hiring employees. As the owner of the staffing company temp to hire has been a very popular strategy the last several years. Now companies are actually hiring people directly to their payroll and willing to pay fees. That would seem to indicate that they do not expect a downturn in the near future. Good news for all of us.
Thanks for the comment, Neil. From what you said, it certainly suggests that if they do expect a recession it will be short and mild and they will soon need those bodies. But what if rates really do need to go to 6% to slow things down enough to trigger the recession? The outcome may not be quite so mild. We will see.
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Jon Witherow
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