Nonfarm Job Growth Hits 850,000 In June, Beating Predictions

Total nonfarm payroll employment rose by 850,000 in June, far outstripping the revised 583,000 jobs created in May. The increase in jobs topped the predictions of analysts.

Despite the job gains, the unemployment rate was largely unchanged at 5.9 percent. On the other hand, that statistic indicates that more workers are coming off the sidelines as the job market improves and the threat of COVID-19 recedes.

The U.S. Bureau of Labor Statistics Employment Situation Summary for June reported that job gains in the leisure and hospitality industry were strong, increasing by 343,000. That sector was hard hit by the pandemic — and despite the gains, employment in that industry remains down by 2.2 million, or nearly 13 percent, from its level in February 2020.

Economists surveyed by The Wall Street Journal had predicted the number of job gains would only hit 700,000.

The federal government statistics came on top of those from the June ADP National Employment Report released Wednesday (June 30), which said the private sector added 692,000 new positions. The ADP figures only include private sector jobs, while the BLS Employment Situation includes statistics from the public sector.

The news comes as more workers — including teens — have received a COVID-19 vaccine and pandemic rules limiting capacity at businesses have eased or ended. As the pandemic recession eases, some employers have, in fact, been raising wages and offering bonuses.

Over half of the leisure and hospitality industry job gains (194,000) were in food services and drinking places, the BLS reported. Employment also continued to increase in accommodations (75,000) and in arts, entertainment, and recreation (74,000).

In addition, the report said job gains were also notable in public and private education, professional and business services, retail and other services.

Despite the good news, the number of long-term unemployed (those jobless for 27 weeks or more) increased by 233,000 to 4 million in June. That followed a decline of 431,000 in May. This figures are 2.9 million higher than in February 2020. In fact, these long-term unemployed accounted for 42.1 percent of the total unemployed in June.

Nonetheless, initial jobless claims — at 364,000 — for the week ending June 26 were at their lowest level since the pandemic hit. March 2020 figures were at 256,000.