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The total employment level, however, remains 7.13 million below where it was in February 2020.
The US economy saw a spike in jobs growth in June as it looks to recover from last year’s hit. The United States Labor Department announced on July 2 that the growth exceeded expectations within the 30 days. Nonfarm payrolls saw an 850,000 increase for the month, up from the 583,000 recorded in May and against the Dow Jones estimate of 706,000.
The Unemployment rate however rose to 5.9% against the 5.6% expectation even though the labor force participation rate was unchanged at 61.6%. A separate figure showing the number of ‘discouraged workers’ alongside those holding part-time jobs for economic reasons saw a massive fall to 9.8%, with the 0.4 percentage point decline pushing the ‘real unemployment rate’ below 10% for the first time since March 2020.
Seema Shah, chief strategist at Principal Global Investors speaking after the announcement stated that “From a market perspective, this was an all-out positive jobs report,” as Markets rose on the news, with futures on the major indexes seeing modest gains on the open before the weekend. “The improvement today likely reflects a slight easing of the labor supply constraints that have been holding back the jobs market in recent months, as well as continued momentum from the economic reopening,” Seema added.
The US economy saw its total job recovery from the pandemic losses to reduced 15.6 million as against the 22.3 million Americans who were laid off in March and April of 2020 after the government imposed bans and restrictions on businesses. The total employment level however remains 7.13 million below where it was in February 2020.
The second quarter saw an unprecedented rise in hiring as the economy edged closer to returning to normal for Americans who were stuck indoors for the past year due to the pandemic-related restrictions. The hospitality industry once again benefited the most from the reopening as workers returned to jobs at restaurants, bars hotels, and the likes of travel agencies. The industry saw a rise of 340,000 jobs including 194,000 in bars and restaurants alone after the U.S government eased restrictions across the country. The industry however still falls 2.2 million short of where it was in February 2020 before the pandemic.
The education sector saw gains of 269,000 across the state including both local and private hiring, while professional and business services rose by 72,000 with retailing adding 67,000. Personal and laundry services added 29,000 jobs, Social assistance recorded 32,000 whiles Manufacturing grew by 15,000 in June month. Construction however lost 7,000 positions despite the booming housing industry.
The US economy also saw a rise in wages as average hourly earnings increased 0.33% for the month and 3.6% year over year, both matching estimates by analysts from Dow Jones.