U.S. adds solid 195,000 jobs in June; unemployment rate holds at 7.6%

WASHINGTON -- Private employers kept hiring at a solid pace in June, an encouraging sign that the U.S. economy is shrugging off government spending cutbacks and is poised for stronger growth in the second half of this year.

Employers in the U.S. added 195,000 net new jobs in June, and job growth for May and April was revised higher to numbers similar to last month’s gain, the Labor Department said Friday.

The nation’s unemployment rate held steady at 7.6% as more workers entered the labor force, an indication that people are feeling more confident about the job market.

The share of the working-age population that have jobs or are unemployed and looking for work had fallen sharply during the recession and recovery, but the so-called participation rate ticked up in June for the second straight month, to 63.5%.

The latest monthly payroll gains once again were led by restaurant and drinking businesses, which added a combined 52,000 jobs. The leisure and hospitality industry, as a whole, accounted for 75,000 of all the net job growth in June.

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These businesses on average pay lower and offer fewer hours of work, and the strong growth last month may reflect some seasonal effects as well as the fact that some workers are finding little choice but to settle for part-time work.

In fact, the number of involuntary part-time workers who want more hours of work rose sharply in June, to 8.3 million.

Still, the job growth in June beat analysts’ expectations and included gains in construction work and higher-paying professional business services such as computer design and management consulting, as well as continued solid hiring in the healthcare sector.

Average hourly pay for all private industry workers rose 10 cents in June, to $24.01.

Overall, analysts on average had projected job growth of 165,000 for June, with gains held back by further cuts because of federal spending reductions under the government sequestration. Federal government employment fell by 5,000 last month, and the public sector overall shed 7,000 jobs, a little less than analysts’ projections.

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don.lee@latimes.com