In a big upside surprise, the US economy has added 255,000 new jobs in July, according to government data. While US unemployment rate stayed at 4.9% in July.
The positive figure comes after the labor market stumbled in May, adding only 11,000 jobs. The forecast was for a July gain of 180,000 jobs. The June rise in jobs was also revised higher today, now seen at 292,000 additional jobs compared with the previous estimate of 287,000.
The strongest sectors in July were hospitality and food, leisure, professional business services, financial activities and healthcare were. The return of striking Verizon workers who subtracted from the May jobs report also boosted the gains in July.
After two huge swings — down in May, then up in June — economists had expected the July jobs report to show that the pace of job creation moved back toward trend.
And so the July jobs report marks a second straight month of strong job gains and should put away recent concerns about a hiring slowdown in the economy.
Last month's strong job growth should reinforce the Fed's confidence in a labor market that officials view as at or near full employment. Fed Chair Janet Yellen has said the economy needs to create just under 100,000 jobs a month to keep up with population growth.
Wages continued to rise for workers in July. Average hourly earnings increased by 0.3%, more than expected, and 2.6% year-on-year, the highest since the Great Recession. Higher wages could hold up the strong level of consumer spending, which drove the economy in recent quarters as business investment fell.
The labor-force participation rate rose to 62.8%. It was being closely watched again to gauge whether a record number of job openings drew people into the labor force.