On the June Jobs Report

The ninth year of this economic expansion wraps up with a very strong jobs report, far outstripping consensus expectations, especially on the back of upward revisions to prior months. The unemployment rate ticked up to 4% only because of 601,000 new entrants to the labor force, almost all of whom come in counting as long-term unemployed. The labor force is now above its decelerated trend, and that trend is now re-accelerating. Tepid hourly wage growth, lower than last months, will allay an concern at the Fed about so-called “wage inflation” feeding into an “overheating” economy.