The unemployment rate in the United States stood at 5.4% in July, half a percentage point below that of June, according to the report by the Labor Department released Friday.
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Unemployment Rate
According to CNBC, the economic recovery helped build on the market’s momentum with 943,000 new jobs created, compared to 938,000 added the previous month, and 614,000 in May.
“Economists surveyed by Dow Jones had been looking for 845,000 new jobs and a headline unemployment rate of 5.7%.”
Non-farm employment in the U.S. has increased by 16.7 million since April 2020, but is still 5.7 million below pre-pandemic employment levels in February 2020. The number of unemployed people also fell by 782,000 to a total of 8.7 million.
Despite the sustained recovery of the labor market, the unemployment rate remains well above the 3.5% registered in February 2020 –before the pandemic– when 5.7 million people were unemployed.
Within this group, temporary unemployment fell by 572,000 people to 1.2 million. This is considerably below the peak of 18 million in April 2020, and still 489,000 above February 2020 levels.
“Average hourly earnings also increased more than expected, rising 0.4% for the month and are up 4% from the same period a year ago, at a time when concerns are increasing about persistent inflationary pressures.”
Reactions
“It feels like a Goldilocks report. You have not too hot in terms of wages, but not too low in terms of job gains,” said Beth Ann Bovino, chief U.S. economist at S&P Global Ratings.
Robert Frick, corporate economist at Navy Federal Credit Union, “This not only was a strong jobs report by nearly every measure, it also signals more good things to come.”
For Ryan Detrick, chief market strategist at LPL Financial, “Although there have been some cracks in the armor, today's jobs number showed that once again our economy is incredibly resilient and moving forward.”
The number of long-term unemployed also decreased by 560,000 to 3.4 million, but it is still 2.3 million more than in February 2020.
Those unemployed long-term account for 39.3% of the total unemployed in July. Also, the number of unemployed people for less than five weeks increased by 276,000 to 2.3 million.
“Data from recent months suggests that rising demand for labor with the recovery from the pandemic may have put upward pressure on wages,” the Labor Department said.
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