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June’s job report reveals the nation’s job growth is slowing down

Construction jobs fell by 18,000 jobs in June

The National Employment Report revealed that private sector employment increased by 102,000 jobs from May to June, rising predominately in the service-providing sector.

However, jobs in the good producing sector, including construction, manufacturing and mining all experienced a decline in June, according to ADP Research Institute and Moody’s Analytics.

Ahu Yildirmaz, vice president and co-head of the ADP Research Institute claims the nation’s job growth is starting to show signs of a slowdown.

“While large businesses continue to do well, small businesses are struggling as they compete with the ongoing tight labor market,” Yildirmaz said. “The goods producing sector continues to show weakness. Among services, leisure and hospitality’s weakness could be a reflection of consumer confidence.”

The chart below demonstrates the rate of increase since 2013:

Moody Analytics - July

(Click to enlarge; image courtesy of ADP)

Notably, the report reveals that the number of jobs added in May was revised up from 27,000 to 41,000.

Below is a breakdown of job segments that saw changes in employment between May and June:

Natural resources and mining: Decrease 4,000

Construction: Decrease 18,000

Manufacturing: Increase 7,000

The service-providing sector increased by 117,000 jobs, including:

Information: Decrease 3,000

Financial activities: Increase 7,000

Professional and business services: Increase 32,000

Education and health services: Increase 55,000

Leisure and hospitality: Increase 3,000

Other services: 0

“The job market continues to throttle back,” Moody’s Analytics Chief Economist Mark Zandi said. “Job growth has slowed sharply in recent months, as businesses have turned more cautious in their hiring. Small businesses are the most nervous, especially in the construction sector and at bricks-and-mortar retailers.”

NOTE: This report is a monthly measure of the change in total U.S. non-farm private employment derived from actual, anonymous payroll data of client companies served by the company. The data is collected and processed with statistical methodologies similar to those used by the U.S. Bureau of Labor Statistics.

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