The June employment report showed nonfarm payrolls rose by 57,000, well below the 113,000 jobs increase expected in a survey compiled by Bloomberg as of 7:40 AM ET, while May payrolls were revised downwards to a 129,000 increase and April payrolls were revised down to a 148,000 increase, for a net downward revision of 74,000 jobs.
Private payrolls rose by 49,000 in June after a 97,000 increase in May, well below the increase of 107,000 private jobs expected. Health care and social assistance jobs rose by 46,600, but leisure and hospitality jobs fell by 61,000.
The unemployment rate fell to 4.2% in June from 4.3% in May, compared with a 4.3% rate expected, while the labor force participation rate fell to 61.5% from 61.8% in May, and the size of the labor force contracted due to declines in both household employment and unemployment.
Hourly earnings increased by 0.35%, compared to the 0.3% gain expected, and following a 0.27% gain in May. Hourly earnings were up 3.5% year-over-year.
The average workweek was unchanged from 34.3 hours in May, as expected, and above the 34.2 hours a year earlier.
The monthly employment report released by the Bureau of Labor Statistics consists of two separate surveys and is considered the most important data release for the month. The survey of businesses measures the levels of employment and wages and the length of the average workweek, broken down by industry.
The survey of households measures the number of people working or looking for work, the unemployment rate, those who have left the workforce, and reasons for part-time work.
Market reaction can be mixed, particularly when the two surveys disagree. A strong increase in employment or a decline in the unemployment rate is generally a positive for stocks as a sign of a strong US economy, but bonds would react negatively to the same news, particularly if wages rise sharply at the same time.