U.S. job growth surged in July, as the economy added a surprising 528,000 positions, defying all expectations of a slowdown, according to official data Friday.
Even the White House had agreed with most economists in predicting the increase would slow to just 250,000 in the month, which President Joe Biden said was part of the natural slowdown after the rapid rebound of the world's largest economy from the pandemic downturn.
Meanwhile, wages jumped—with average hourly earnings up 15 cents over June—which will surely add to inflation concerns, as the Federal Reserve raises interest rates aggressively to cool the economy amid the highest price gains in more than 40 years.
In manufacturing, employment increased by 30,000 in July. Durable goods companies added 21,000 jobs with gains in semiconductors and electronic components and miscellaneous durable goods. With 12.9 million people employed in manufacturing, the industry hit its highest rate since August 2019 (when roughly 12,000 more people worked in manufacturing). Employment in manufacturing is 41,000 above its pre-pandemic February 2020 level.
Despite that strong manufacturing hiring, there are signs that companies still can’t find enough people. Overtime increased by slightly to 3.3 hours per week in the sector.
The widespread job gains helped lower the unemployment rate back to the pre-pandemic low of 3.5%, the Labor Department reported. And the outsized job gain in June was revised higher. Total non-farm employment also recovered to its pre-pandemic level, the data show.
Builders have struggled for months to find workers to meet high demand for construction, but employment in the sector is now back to its pre-pandemic level, the report said.
Copyright 2022, Agence France-Presse (IndustryWeek staff members contributed to this report)