Healthy, but not toned

AMERICA’S economy has been looking frail. According to recently revised estimates, in the first quarter of 2015 GDP shrank by 0.7%, at an annualised rate. Yesterday the International Monetary Fund advised the Federal Reserve not to raise interest rates until next year. But the prognosis is not all bad. For signs of strength, look at the labour market. Today the Bureau of Labour Statistics reported that about 228,000 non-farm jobs were created in May—below the monthly average for the past year, but healthy nonetheless. There are now 11m more jobs than when the recession finished in mid-2009; the unemployment rate is 5.4%, more than half a percentage point below the average over the past two decades. One black spot, though, is wages. In the past few months the rate of pay increases has fallen. That suggests that the American labour market still has lots of slack.

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