Is the U.S. jobs market getting better? June employment report to give us a heat check.

By Jeffry Bartash

Economists forecast 115,000 new jobs and a 4.3% unemployment rate

Job seekers attend a small-business summit and job fair hosted by the Chicago Department of Aviation.

Is it getting easier to find a job? Are businesses really hiring more workers? That's what the official data statistics tell us, but Americans aren't so sure.

The number of new jobs created in June will provide more answers. Here's what to watch on Thursday, when the employment report is released a day early due to the July 4 holiday.

Hiring on the upswing

The U.S. economy created an average of 188,000 new jobs a month from March through May, marking the best stretch of hiring in more than three years.

That is, if the government statistics are accurate.

In both 2024 and 2025, the Bureau of Labor Statistics reported fairly strong hiring in the first five months of the year, followed by a summer lull. Some economists question if the pattern is repeating itself, thus exaggerating the improvement in the labor market.

Even if hiring has accelerated, some also question whether it's due to temporary conditions. Spring weather has been been very favorable, for instance, and the World Cup has boosted hiring.

We'll get a better idea in June, especially if employment matches or exceeds the Wall Street forecast of 115,000 new jobs.

Unemployment is low

The best thing about the jobs market is the historically low level of layoffs and the low unemployment rate. Businesses aren't creating tons of new jobs, but they also aren't cutting many either.

The unemployment rate is projected to stay at 4.3% in June for the fourth month in a row.

Remarkably, the jobless rate has been below 5% since 2016, with the lone exception of a 16-month stretch during the 2020-21 pandemic.

Who's hiring?

Healthcare providers created all the new jobs in 2025 - but it's, well, unhealthy when one sector is doing most of the hiring. When the labor market is good, lots of businesses are adding jobs.

Hiring appears to be slowly broadening out.

About half of the new private-sector jobs created this year have been in fields other than healthcare. It would be a good sign if that trend is repeated in June.

Worker pay

The most surprising thing about high inflation since the pandemic is that labor costs have played virtually no role. Historically, rising wages have been the main source of excess inflation.

The yearly increase in wages rose at a 3.5% rate in May, very close to how fast worker pay was rising before the pandemic.

If inflation gets worse, it's bound to show up in wages. Workers will demand more pay to keep up with their costs of living.

Economists predict the 12-month increase in wages will stick to around 3.5% in June - not high enough to raise any worries, but not reassuring either.

Fed reaction

Only a big increase in new jobs - say, 150,000 or more - could worry the Fed enough to consider an interest-rate increase at its next meeting later this month.

Anything less than that, and the Fed is almost certain to stand pat.

-Jeffry Bartash

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07-01-26 1443ET