American business kept up their fiery pace of hiring in June, adding 177,000 jobs, according to the latest monthly survey by payroll processor ADP.
May’s private sector payrolls were revised up to 189,000 from a previously reported 178,000.
The American labor market is very strong. The average job gain per month for the last 12 months is 190,000, about double the rate of growth of the American workforce. As a result, unemployment is likely to continue to fall despite being already at record-breaking low-levels.
Despite the very low unemployment and robust hiring, pay growth remains elusive. Average hourly wages have been not been rising after adjusting for inflation, according to the Labor Department.
That may change soon.
“Business’ number one problem is finding qualified workers. At the current pace of job growth, if sustained, this problem is set to get much worse. These labor shortages will only intensify across all industries and company size,” Mark Zandi, chief economist of Moody’s Analytics, said. Moody’s helps ADP prepare the report.
Of course, the “problem” for business is a boon for workers. From a job-seekers point of view or from an employee looking for a raise, this economy is set to get much better–not much worse.
Zandi said that wage growth should be solidly 3 percent by next year, up from just around 1.5 percent just a few years ago.
Economists had expected even more jobs in June, around 190,000. But the upward revision in May may indicate that some of the jobs that were expected in June had already been created the month earlier.