The U.S. economy added 850,000 jobs in June—the biggest gain in 10 months—and workers’ wages rose briskly as the labor market heated up after a spring lull.
The increase in U.S. jobs reported Friday by the Labor Department was the strongest since last August and exceeded economists’ estimates. It followed a gain of 583,000 jobs in May and 269,000 in April.
The unemployment rate, derived from a separate survey of households, rose to 5.9% from 5.8%, in part because the number of job seekers grew last month.
Employers raised wages as they continue to ramp back up and compete over a limited pool of workers. The average hourly pay of private-sector employees rose 3.6% in June from a year earlier. Compared with February 2020—the month before the pandemic plunged the U.S. into a recession—average hourly earnings are up 6.6%, well above inflation, which rose 3.8% in May from the year before, according to the Labor Department’s consumer-price index.
U.S. stocks rose Friday after the monthly employment report. The S&P 500 added 0.2%, while the Dow Jones Industrial Average advanced 0.1%. For investors, the gains were further evidence the economic recovery remains intact, so far fulfilling predictions by Federal Reserve Chairman Jerome Powell. The central bank is monitoring jobs data to determine when and how quickly to raise interest rates.
