Job growth in the U.S. saw a spike last month, providing a glimmer of hope as the country teeters on the brink of a recession.
According to the U.S. Labor of Department, employment levels are back to its pre-pandemic level, negating proclamations that the country is already in a recession.
“The combination of strong job growth, an extremely tight labor market and stubbornly high wage inflation suggests the Fed’s rate hike cadence will likely remain hefty next month,” said Michael Gregory, deputy chief economist at BMO Capital Markets.
In addition to an increase in jobs, the report showed that employers have consistently raised wages and experienced longer work hours, exceeding expectations from analysts.
A Reuters poll of economists showed that payrolls would grow by an estimated 250,000.
Hourly earnings grew 0.5% in July compared to the 0.4% seen in June, indicating that wage growth may have reached its max. While inflation has slightly cooled due to interest rate hikes, it continues to outpace wage growth.