It’s been said that one jobs report is just one jobs report, but this is one great jobs report. According to the latest release from the Bureau of Labor Statistics, approximately 943,000 jobs were added to the U.S. economy last month, bringing the unemployment rate down from 5.9% to 5.4%.
Considered alongside the upward swing in last month’s report (from 850k to 938k new jobs) that makes two consecutive months of truly dynamic job growth, totaling nearly 2 million new jobs combined. For context, recall that the past four months collectively only account for about 2.8 million in total, underscoring the strength of this trend.
With jobs gains high, the number of unemployed persons was reduced to 8.7 million. This also represents a significant month-to-month improvement.
Although the U.S. economy still has a long way to go before fully returning to pre-pandemic employment levels, last month’s jobs report was rare in that it contained almost exclusively encouraging news. In addition to the drop in the unemployment rate and the jobs figures, people experiencing temporary layoffs fell by about 32% to 1.2 million.
What’s more, the number of long-term unemployed (or those who have been out of work for at least 27 weeks) fell by over half a million persons (now 3.2 million people). Given that nearly 40% of all unemployed people fell into this category last month, however, there is still much work to be done.
The industry that saw the biggest month-to-month improvement is once again leisure and hospitality, which added almost 400k jobs alone. In fact, over the past four months combined, the leisure and hospitality industry has accounted for about half of news jobs created in that time frame.
Interestingly, the rate at which employees are returning to onsite work seems to be slowing, with only a 1.2% reduction in the number of employees working remotely compared to the 2.2% reduction that occurred the month before. The percentage of employees continuing to work remotely over the past month sits at 13.2%, representing a substantial albeit shrinking proportion of the workforce.
Aside from leisure and hospitality, public education is another industry that performed well last month, adding over 220k jobs as schools staff up for the coming year. But job gains were common across almost all industries with the only notable exceptions including retail (down 7k jobs) and building material and garden supply stores (down 34k jobs), both of which are managing seasonality and supply chain challenges.
Overall this jobs report represents some of the best news we’ve had, signaling how both the economy and the job market are attempting to rebound from the past 18 months. Although much was made of business hiring woes previously, this report reinforces the notion that plenty of jobs are being added and plenty of workers are ready to fill them. To that point, hourly pay is also up 4% year-over-year.
Although concerns about the Delta variant are certainly justified, there is reason for optimism that this positive economic trajectory may continue. We will have to see what the next few months have in store but—regarding the nation’s current economic recovery—the latest report is unequivocally good.
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