June’s payroll print of 57,000, roughly half the 115,000 Wall Street had expected, hit Robinhood (HOOD) feeds while revisions stripped another 74,000 jobs from prior months.
Wage growth slipped to 3.5% annually, a rate below what economists link to stable inflation, handing the Fed cover to cut rates despite elevated core PCE.
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Rick Santelli called the June jobs number over CNBC’s floor mic this morning, and if you were half-listening on the Robinhood (NASDAQ:HOOD) app, you probably heard the pause before the number. “Our June release of the job jobs report headline number comes in light change in nonfarm payrolls 57,000. That’s about half of what we were expecting.” Wall Street penciled in roughly 115,000. It got roughly half.
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The market’s first instinct on a jobs number like this is to reprice the Federal Reserve. The 10-year Treasury yield sat at 4.44% on June 30, having already drifted down from 4.51% on June 22 as bond traders sniffed out weakness before the official release. The 2s/10s spread compressed to 0.27% on June 22, the tightest reading of the last year, signals the growth story is thinning out.
A big miss on the headline number
Fifty-seven thousand jobs is not a recession number by itself. But the context is unfriendly. Santelli noted that this would be “the lightest since it was negative in February… And that was the only negative number going all the way back to December of 2020.” the softest month outside of a one-off contraction earlier this year, which was the first negative reading in roughly five and a half years.
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Manufacturing did the ugliest work inside the report. Factory payrolls swung to -2,000 in June from +7,000 in May, which lines up with a jobless claims picture that has quietly deteriorated. Initial claims came in at 215,000 for the week ending June 27, still healthy on the surface, but up from an April low of 190,000. Claims tell you who is losing a job. Payrolls tell you whether anyone is being hired to replace them. Right now, both dials are moving the wrong direction.
One counterweight. The unemployment rate actually ticked down to 4.2% in June from 4.3% in May. That divergence, weak hiring alongside a lower jobless rate, usually means the labor force itself is shrinking.