Job creation roared back to life in July as the U.S. economy added the most number of new workers in close to a year, driven largely by bars, restaurants and hotels hiring tens of thousands of employees.
The Labor Department said in its Friday report that employers added 943,000 jobs last month, topping Wall Street’s expectations for a gain of 870,000, while the unemployment rate fell to 5.4%, a new pandemic low. June’s reading was revised higher by 88,000 jobs to 938,000.
Leisure and hospitality, one of the industries hit hardest by the coronavirus pandemic, led in terms of job growth, with gains of 380,000. Restaurants and bars accounted for roughly two-thirds of the total, or about 253,000, while hotels added 74,000 new positions – evidence that more Americans are venturing out as vaccination levels increase and business restrictions ease.
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Amusements, gambling and recreation hired 40,200 new workers, while employment in the arts, entertainment and recreation industry increased by 53,000.
Despite the gains, there are still about 1.7 million fewer jobs in the leisure and hospitality industry than there were in February 2020, before the pandemic began.
Education and health services, another major source of job creation, surged by 87,000 with growth across the board. Roughly half of the gains stemmed from educational services, which added 40,000, reflecting the continued resumption of in-person learning and other school activities across the country, while 46,800 came from health care and social assistance.
“Notable job gains occurred in leisure and hospitality, in local government education, and in professional and business services,” the Labor Department said in its report.
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Transportation and warehousing picked up 49,700 jobs, and employment in the professional and business services surged by 60,000, with gains in administrative and support services (19,900), account and bookkeeping services (8,400), architecture and engineering firms (4,600) and computer systems design and related service (5,200). Manufacturing contributed 27,000 jobs last month.
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The government also helped boost payrolls last month, hiring 240,000 new workers. Local governments accounted for the majority of those gains, onboarding 230,000 new employees in July. The federal government added 18,000 workers, while state governments lost about 8,000.
Still, some sectors actually shed workers last month: Retail trade fell by 5,500, reflecting a job loss in motor vehicle and parts dealers and building and garden supply stores – which outweighed gains in clothing stores and gas stations.
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