June Jobs Report

June Jobs Report Up 4.8 Million. Industrial Economic Indicators Rebounded in May and June but Still Far Below 2019 Levels

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On July 2nd, the Bureau of Labor Statistics released its monthly non farm payrolls report for the month of June. In June the U.S. economy added 4.8 million jobs. May and June saw Industrial indicators like durable goods orders and light vehicle sales rebounded from April lows. However, levels still remain at some of the lowest points since the 08 recession.

The 4.8 million June Jobs number far exceeded consensus estimates for an increase of 2.9 million. However the number of workers on temporary layoff also decreased by 4.8 million. Suggesting almost all of the jobs were workers returning from Covid shutdowns. Despite the positive jobs report. Initial jobless claims, also released earlier this morning were higher than expected at 1.427 million for the week ended June 27. Continuing claims remained stubbornly high at over 19 million and actually increased for the first time in several weeks to 19.29 Million. An increase of 61,000 from the week before. Previous weeks have seen steep drops from April Highs before flattening in recent weeks. This may reflect some state and corporate pauses in reopening plans as positive case counts have begun rising in recent weeks.

Beyond the jobs front, Industrial production recorded a reading of 92.6 in May, a slight rebound from April’s 91.3 reading. Market participants are hoping for a rise in June as states and economies implement easing restrictions but will still be far below the 109.4 reading as recently as February.

 

Durable Goods Orders

Durable goods orders, an important metric regarding the industrial and manufacturing economy, plummeted from recently stable levels to Great Recession lows as economies in the U.S. and across the world shut down in March and April. The May reading saw a small bounce back. Durable goods orders are still at the lowest levels since 2009. June’s reading will be closely watched to see the impact of orders as economies continue the reopening process.

Commodities Rebounding & Other Economic Indicators

One bright note for demand; several commodities have returned to at or near pre covid levels. Copper closed at $2.73 per pound on July 1, 2020. Its highest level since January 22, before the virus took major impact on world economies. Corn prices per bushel have rebounded recently closing at $3.51 on July 1. Still down from the $3.70 level it was trading at on or around March 1, and YTD highs of around $3.90. Considerably higher than the $3.06 low seen on April 28th.

The economic data indicates a mixed picture of economic recovery. We will see in coming months what develops. AEA remains ready to support your Trackmobile rail car mover, Crane & Hoist, Compressor, and Industrial Chiller needs. 

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For Further Information see BLS Report

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