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By Lucia Mutikani
WASHINGTON (Reuters) – U. S. employers hired far more staff than expected in July, and the unemployment rate fell to a pre-pandemic low of 3. 5 percent, offering the most powerful evidence to date that the economy is not in recession.
Nonfarm payroll rose to 528,000 jobs last month, the Labor Department said Friday in its closely watched jobs report. June data was revised upwards to show 398,000 jobs created instead of the 372,000 reported in the past.
This marked the 19th consecutive month of payroll expansion. The unemployment rate 3. 6% in June.
Economists polled through Reuters had forecast a buildup on the wage bill of 250,000 jobs and a solid unemployment rate of 3. 6%. Estimates ranged from 75,000 to 325,000 jobs.
The jobs report painted a picture of a fairly healthy economy that is recovering despite consecutive quarters of gross domestic product contraction. locate enough workers.
The sharp expansion in employment may keep up the pressure on the Federal Reserve to offer a third interest rate hike of 75 basis points at its next meeting in September, this depends largely on inflation figures. Last week, the U. S. central bank said that it was not very much the case. The U. S. raised its key interest rate by three-quarters of a percentage point. It has raised the rate through 225 issues from the foundation since March.
The economy contracted by 1. 3% in the first part of the year, largely due to sharp fluctuations in inventories and the industry’s deficit similar to that suffered by global supply chains. However, the momentum is slowing.
The National Bureau of Economic Research, the official arbiter of recessions in the United States, defines a recession as “a significant decline in economic activity spread across the economy, for more than a few months, visible in output, employment, real incomes, and other indicators. “
With 10. 7 million job openings at the end of June and 1. 8 million vacancies for the unemployed, the labor market remains tight and economists do not expect a sharp slowdown in payroll growth this year.
Average hourly earnings rose 0. 5% last month, following a 0. 4% increase in June. This allowed the annual salary to increase by 5. 2%. Although wage expansion appears to have peaked, the pressures continue. expansion in the current quarter the fastest since 2001.
(Reporting through Lucia Mutikani; Editing via Chizu Nomiyama)