IHS Markit’s Composite PMI score for June jumped from 37.0 in May to 47.9, indicating that the pace of contraction had slowed considerably. The softer contraction was attributed to both an increase in consumer demand and the resumption of manufacturing and service activities. Comments on the report noted that there was a strong initial rebound from the height of pandemic lockdowns in April, but that some companies remained constrained by social distancing measures. The report also noted that a return to growth in the third quarter looked likely, but that growth could tail off due to persistent virus containment measures, or that a reintroduction of lockdowns could cause a return to recession conditions.

There were 5.4 million job openings on the last business day of May. The limited resumption of economic activity helped push hires in May to a record high 6.5 million, which followed a record low number of hires (4.0 million) in April. Hires increased in all regions, with the largest increase for accommodation/food services (+763,000), health care/social assistance (+479,000), and construction (+427,000). The rate of layoffs and discharges decreased to 1.4%, nearing February’s pre-pandemic rate of 1.2%, and was down from March’s record high 7.6% rate. For the 12 month period ending in May there were 68.5 million hires and 79.8 million separations, yielding a net employment loss of 11.3 million jobs.

Producer prices fell -0.2% in June after a +0.4% increase in May and a -1.3% drop in April, and were down -0.8% over the 12 months ending in June. The drop in producer prices was largely due to a -0.3% drop in service prices, which was in turn due to a -1.8% drop in trade services. Trade services measure the change in margins received by wholesalers and retailers, and much of May’s service prices drop was due to a -7.3% decline in margins for machinery and vehicle wholesaling. Excluding the volatile effects of trade, transportation and warehousing, core producer service inflation was up +0.3%. Producer prices for goods were up +0.2%, with a +7.7% increase in energy costs balancing a -5.2% drop in food prices. Excluding food and energy, goods prices edged up +0.1%. Core producer prices, excluding food, energy, and trade services were down -0.1% for the year.