The US economy added 285,000 nonfarm payroll jobs in July and the unemployment rate fell to 3.9% from 4.1%, the Bureau of Labor Statistics reported in a jobs report that far exceeded the 195,000-job consensus forecast. Job gains were broad-based, led by healthcare (+78,000), professional services (+54,000), leisure and hospitality (+48,000).
Manufacturing employment rose for the third consecutive month, gaining 22,000 positions as reshoring incentives continued to bring factory jobs back to the US. Average hourly earnings rose 4.1% year-over-year, above inflation, meaning real wages are growing for most American workers.
The strong report complicated the Federal Reserve's rate cut calculus, with the probability of a September cut falling to 58% from 78% before the release. President Trump called the numbers incredible and a validation of his economic policies.
