Restaurants and bars picked up their pace of hiring in July, new federal data show, shaking off a variety of economic and inflationary concerns to add more people than they have in six months.
Food services and drinking places added 74,100 jobs in the month, according to the U.S. Bureau of Labor Statistics. They now employ 11.7 million workers. That remains over 600,000 workers short of where the industry was in February 2020, before widespread shutdowns due to the pandemic led to mass layoffs.
Average hourly earnings, meanwhile, fell for the first time since May 2020. Average hourly earnings for nonsupervisory leisure and hospitality workers declined by 0.16% in July. They remain more than 8% over where they were a year ago, but wage rates appear to have moderated in recent months after soaring for much of the past two years.
Overall, the economy added 528,000 jobs in July and the unemployment rate fell slightly to 3.5%.
The continued strong rate of job growth is likely to add to concerns about inflation, as competition for workers drive up wages and lead to higher prices. While wages in the restaurant industry have eased, many operators have been increasing menu prices to maintain margins as their own costs have increased.
The result is likely to lead to further higher interest rates as the U.S. Federal Reserve looks to cool inflation.
Restaurants have been steadily adding jobs over the past year and a half as consumers have returned to normal rates of dining out and operators have brought back their workforces. Yet the industry has yet to fully recover its level of employment—even though private sector employment caught up to pre-pandemic levels last month.
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