Job creation picked up steam in June as the U.S. economy added the most new workers in 10 months, driven largely by bars, restaurants and hotels re-hiring thousands of employees.
The Labor Department said in its Friday report that employers added 850,000 jobs last month even as the unemployment rate ticked up slightly to 5.9%, topping Wall Street’s expectations for a gain of 700,000. It marked a vast improvement from May, when the economy added a lower-than-projected 583,000 jobs.
Leisure and hospitality, one of the industries hit hardest by the coronavirus pandemic, led in terms of job growth, with gains of 343,000. Restaurants and bars accounted for 194,300 of the total, while hotels added 75,100 new positions – evidence that more Americans are venturing out as vaccination levels increase and business restrictions ease. Amusements, gambling and recreation hired 44,800 new workers, while employment in the arts, entertainment and recreation industry increased by 73,600.
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There are roughly 2.2 million fewer jobs in the leisure and hospitality industry than there were in February 2020, before the pandemic began.
“Hiring jumped in June as more sectors are returning to normal operating conditions this summer,” said Ben Ayers, Nationwide senior economist. “With job openings at a record high and signs of building consumer demand, job gains, especially among service sector firms, should remain strong over the rest of the year – helping to drive the economy forward into 2022.”
Retail trade accounted for 67,100 new jobs, with gains in motor vehicle and parts dealers (9,000), clothing stores (27,900), sporting goods stores (7,400) and general merchandise stores including department stores, warehouse clubs and supercenters (24,500).
“Notable job gains in June occurred in leisureand hospitality, public and private education, professional and business services,retail trade, and other services,” the Labor Department said in the report.
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Education and health services, another source of job creation, surged by 59,000 with gains across the board. Most of the gains stemmed from educational services, which added 38,600, reflecting the continued resumption of in-person learning and other school activities across the country, while 20,200 came from health care and social assistance.
Transportation and warehousing picked up 10,700 jobs, and employment in the professional and business services surged by 72,000, with gains in administrative and support services (39,700) and temporary help service (33,000).
The government also helped boost payrolls last month, hiring 188,000 new workers. Local governments accounted for the majority of those gains, onboarding 124,000 new employees in June. State governments added 69,000 workers, while the federal government lost about 5,000.
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Still, some sectors actually shed workers last month: Construction employment fell by 7,000, reflecting a job loss in heavy and civil engineering construction and specialty trade contractors. Health care lost 12,200 workers, largely in hospitals and nursing and residential care facilities.