The U.S. economy added significantly more jobs in July than expected.
The Labor Department said Friday 528,000 jobs were added last month, whereas economists were expecting around 250,000. This was also up from 398,000 jobs added in June, a number that was revised in the latest report. The unemployment rate declined to 3.5 percent, the same level as in February 2020, before the pandemic began to shut down the economy.
“Job growth was widespread, led by gains in leisure and hospitality, professional and business services, and health care,” the Labor Department said.
The report came just one week after the Bureau of Economic Analysis confirmed the economy shrank for the second consecutive quarter in Q2, which by one common definition suggests the U.S. has now entered a recession.
But “even as the broader economy shows signs of slowing, the labor market remains a pillar of strength, holding up the economy,” Glassdoor lead economist Daniel Zhao said, adding, “As tighter monetary policy bites, the labor market is likely to slow in the coming months, but for now, the labor market remains red hot, hopefully assuaging recession fears.”
Indeed, Fitch Ratings chief economist Brian Coulton reacted to the numbers by writing, “Recession — what recession?” President Biden, meanwhile, celebrated the report, suggesting it indicates “we are making significant progress for working families.”