July jobs jump more than 500k, significantly exceeding earlier estimates
Unemployment drops to 3.5 percent in encouraging labor report.
The U.S. economy added more than 500,000 jobs in July, significantly exceeding earlier estimates and putting a rosy spin on the economy for a White House that badly needs it as midterms approach.
Total nonfarm payment "rose by 528,000 in July," the Bureau of Labor Statistics said in a Friday press release, while the unemployment rate "edged down to 3.5 percent." Job growth was widespread, led by gains in leisure and hospitality, professional and business services, and health care," the bureau said. "Both total nonfarm employment and the unemployment rate have returned to their February 2020 pre-pandemic levels."
The encouraging numbers come in contrast to forecasts by analysts and market-watchers who had predicted much more lukewarm numbers. The Dow Jones estimate had projected just under 260,000 jobs added in July.
The picture was not all encouraging, however, as wage growth came in at 0.5 percent month-over-month and 5.2 percent year-over-year. Wage growth implies ongoing inflation, which has already taken huge chunks out of consumer budgets, particularly at grocery stores and other critical consumer hubs.
Stocks appeared to show relatively little response to the news, with both the Dow and S&P fluctuating little, though both continued the modest downward trend they've been on since Wednesday.