U.S. Economy: 943,000 Jobs Added In July, Unemployment Rate Fell To 5.4%

A strengthening U.S. labor market added cushion to the economic recovery in July ahead of the Delta variant threat, with employers creating jobs at the best pace in nearly a year and the unemployment rate falling sharply.

Nonfarm payrolls rose by a seasonally adjusted 943,000 in July, from June’s upwardly revised gain of 938,000, the Labor Department said Friday. The July jobs increase was the largest since August 2020.

The unemployment rate, derived from a separate survey of households, fell to 5.4% in July from 5.9% in June. The July jobless rate was the lowest since March 2020, when the coronavirus pandemic first took hold in the U.S. The number of Americans working or seeking work last month rose, and wages increased at a faster rate, especially for restaurant workers.

Friday’s report showed that the U.S. economy is facing any threat posed by the Delta variant with a strong tailwind. The economy has recovered rapidly this year with availability of vaccines, business reopenings, pent-up consumer demand and aid flowing from multiple rounds of government stimulus legislation.

Falling unemployment and rising wages further reinforce underlying strength, and so far there is little evidence to suggest that the recent case surge is significantly slowing the U.S. recovery.