The U.S. Labor Department said Friday the economy added 943,000 jobs last month. It also revised the May and June numbers upward, and the unemployment rate dropped half a percentage point to 5.4 percent.
Seasonal factors padded the payrolls. With many students in summer school catching up on what they missed due to disruptions, the education sector added a whopping 261,000 jobs. Before the health crisis, education employment would typically decline in July as schools close for the season.
Hiring boomed in the services sector, particularly restaurant workers. With more vaccinated Americans eating out and traveling, restaurants and bars hired 253,000 people.
Analysts said the strong numbers increase the odds the Federal Reserve will begin tapering their bond purchases sooner. The Fed has maintained loose monetary policy throughout the pandemic to stimulate growth.
The Delta variant of the coronavirus didn’t impact the July report due to the timing of the survey, but the recent surge in COVID-19 cases poses a risk to the economy. Spiraling cases could keep workers at home and hamper hiring.
Source: Reuters