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The U.S. economy added 4.8 million jobs in June, with the unemployment rate declining 2.2 percentage points to 11.1 percent. NAFCU Chief Economist and Vice President of Research Curt Long credited the strong rebound to leisure and hospitality jobs as restaurants and bars began reopening in many states.

"Workers on temporary furlough plummeted, though there are still over 10 million such workers," said Long in a new NAFCU Macro Data Flash report. "More troubling is the sharp rise in permanent job loss, which increased by 600,000 to 2.9 million.

"That is up from 1.3 million in February, providing a glimpse at COVID’s long-term damage to the economy," Long added. "For context, it took two years to work off that amount of permanent job loss during the Great Recession, and the number is likely to get worse before it gets better."

Average hourly earnings decreased 35 cents in June, driven by lower-wage workers returning to the job market. Of note, April and May numbers were revised downward 100,000 and up 190,000 jobs, respectively.

The labor force participation rate increased to 61.5 percent, still down significantly from 63.4 percent in February. Leisure and hospitality led the way, recovering 2.1 million jobs, followed by retail trade (+740,000), education and health services (+568,000), and other services (+357,000).

Additionally, results among the major industries showed significant gains. 

"The recent improvement in the labor market is encouraging, but there is still a deep hole to dig out of, and further gains will be harder to achieve," Long concluded.