July jobs report: Economy adds 1.8 million jobs and unemployment rate falls to 10.2 percent

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July jobs report: Economy adds 1.8 million jobs and unemployment rate falls to 10.2 percent

The job additions were sizable, but there are signs that the labor market recovery is cooling. In June, the economy added back 4.8 million jobs. In July, the number of coronavirus cases began surging and some employers either paused hiring or – in some cases – laid off workers for a second time.

The July gains were driven by hiring in sectors that had been hard hit by coronavirus and closure measures, such as leisure and hospitality, which increased by 592,000 jobs — about a third of the total monthly gain. Employment at restaurants, bars and other food and drink services rose by 502,000.

Amusements, gambling and recreation added another 100,000.

Employment at government agencies also rose in July, by about 300,000, including 215,000 working in education at the local level.

Still, employment in those sectors remains well below pre-pandemic levels, as the economy struggles to gain back the more than 20 million jobs lost during the pandemic. Fewer than half of the jobs lost in April have been recovered in May, June, and July. More than 30 million people are currently receiving some form of unemployment insurance.

The figures are drawn from a weeklong survey that takes place the week of the 12th each month — the middle of July. Because of the lag, economists urged caution about interpreting them, noting more troubling economic signs have emerged in recent weeks.

Data from payroll processing company ADP showed a significant slowdown in hiring during July. Before that, the Federal Reserve Bank of St. Louis pointed to indicators from the scheduling company Homebase that showed that the recovery in employment that took place in May and June had begun to halt as a result of the spike on coronavirus infections. That data showed a strong correlation between states with larger infections and the slowdown in the labor market’s recovery.


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