Newspaper article THE JOURNAL RECORD

U.S. Jobless Claims Up Slightly; Nation's Factory Orders

Newspaper article THE JOURNAL RECORD

U.S. Jobless Claims Up Slightly; Nation's Factory Orders

Article excerpt

WASHINGTON (AP) -- The economy is still roaring ahead, creating more than a quarter-million new jobs in June everywhere from amusement parks to banks.

Though the overall unemployment rate crept up to 4.3 percent, all industries except manufacturing and mining posted solid gains. Indeed, some economists suggested the strong job growth could prolong concern at the Federal Reserve that the economy might be growing too fast for its own good.

American businesses added 268,000 new jobs, a big turnaround from May when they cut payrolls by 5,000, the Labor Department said Friday.

The unemployment rate went up slightly in June because the people entering the labor force out-paced even the large number of jobs that were created. May's rate of 4.2 percent had been a 29-year low.

The record-length peacetime economic expansion is reaching groups that often lag behind. The jobless rate for blacks fell to a record low of 7.3 percent in June. And rates for women and Hispanics remained close to their lowest levels in three decades.

For some economists, the overall employment figures indicated a tight job market that could push wages up and lead to broader inflation, something the Federal Reserve is keeping an eye on.

Average hourly earnings -- a key gauge of inflation -- were up by 3.7 percent over the previous June, to $13.23.

"The firmness depicted in these data certainly keeps the debate open regarding an Aug. 24 rate hike," said Marilyn Schaja, an economist at Donaldson, Lufkin and Jenrette, referring to the date of the Fed's next meeting.

The Federal Reserve on Wednesday boosted a key short-term interest rate by a quarter point, citing concerns that tight labor markets could begin pushing inflation higher as workers demand higher wages. But financial investors were encouraged when the central bank signaled that one rate hike might be all that was needed. …

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