For the month of July, nonfarm payrolls increased by 528,000, exceeding both Dow Jones forecasts of 258,000 and 3.6 percent, respectively. The unemployment rate has now fallen to 3.5 percent.
This is good news for the job market, which has been one of the key indicators of the health of the economy. The strong jobs number indicates that the economy may still be on track, despite other recent signs that the recovery may be losing steam.
The unemployment rate for Black Americans rose 0.2 percentage points to 6 percent in July, however. This is still higher than the overall unemployment rate, but it is a sign that the jobs market is improving for all groups of people.
The strong jobs number was driven by gains in several sectors, including manufacturing, construction, and professional and business services. Average hourly earnings also surged higher, rising 0.5% for the month and 5.2% from the same time a year ago.
The strong jobs report adds fuel to an inflation picture that already has consumer prices rising at their fastest rate since the early 1980s. The Dow Jones estimate was for a 0.3% monthly gain and 4.9% annual increase.
Despite the strong jobs report, though, some economists are still predicting that the economy will slow in the second half of the year as the impact of stimulus measures wears off and businesses remain cautious about hiring. The unemployment rate fell to 4.8%, but that was largely due to people leaving the labor force.
Overall, though, the labor market remains strong despite other signs of economic weakness. With July’s gains, employment has now increased for four straight months, and the jobs market appears to be weathering the current economic slowdown better than expected.
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