US employment data expected to rebound in June following end of Verizon labor strike

The United States is expected to witness a rebound in the June employment data, after it had worsened to near five-year lows in May, following the Verizon labor strike that hurt employment and hiring. Now that the strike has collapsed, employment sector may witness some green shoots.

The strike at Verizon cut the total gain in new jobs by around 35,000. The returning Verizon workers still will not be counted in the revised May jobs report. But employment gains will probably be revised higher, perhaps substantially, after the government includes responses by businesses that turned them in late.

"In total, we estimate non-farm payrolls increased 150,000 in June. We expect average hourly earnings to have increased 0.2 percent m/m in June in line with the recent trend implying an annual growth rate of 2.7 percent, the highest since the crisis," Danske Bank said in a recent research note.

In addition, the unemployment rate declined to 4.7 percent in May, due to a falling participation rate. However, the unemployment rate in June is expected to have climbed to 4.8 percent, the report said.

Meanwhile, after the creation of more than 13 million new jobs since 2011, hiring in the US is bound to slow sooner rather than later, economists predicted. Many assume monthly job creation will taper off to the 100,000 to 150,000 range.