The U.S. economy created more jobs than expected in August as the federal government's hiring for the 2020 census and a rebound in retail employment boosted almost all major sectors.
The Department of Labor reported Friday that the workforce rose 1.37 million in August, up from the estimate of 1.32 million expected by economists polled by Dow Jones. The unemployment rate fell to 8.4% and was thus far above the expected 9.8%.
CNBC examined the net changes in industry for August jobs based on the data in the employment report.
The government showed the strongest recruitment figures. A stream of federal government hires for the 2020 census increased the net wage bill for the sector by 344,000, roughly 25% of the monthly increase in total non-farm employment. This striking number was largely thanks to the hiring of 238,000 temporary workers for the 2020 census by the federal government.
"After yesterday's sell-off, there will be a collective sigh of relief that wages rose 1.37 million in August for the fourth straight month," Seema Shah, chief strategist at Principal Global Investors, said in a statement sent by email.
"One small downside to today's report is the impact it may have on discussions about tax assistance," she added. "With increasing signs that US activity is improving and jobs are returning, there is less pressure on Congress to get a new stimulus package through. That will be a mistake."
Retail took second place in August with 249,000 additional jobs. Almost half of that increase was in general goods stores, which include department stores, warehouse clubs, and super centers. Motor vehicle and parts dealers also saw remarkable increases of 22,000, while electronics and home appliances businesses achieved 21,000.
"These improvements in the labor market reflect the continued resumption of economic activity, which has been restricted due to the coronavirus pandemic (COVID-19)," the government said in a press release.
"In August, an increase in government employment largely reflected the temporary suspension for the 2020 census," the Labor Department added. "There have also been notable increases in employment in retail, professional and business services, leisure and hospitality, and education and health."
Leisure and hospitality continued to see strong numbers after being mistreated as Covid-19 earlier this year and efforts to contain its spread frozen travel plans and closed restaurants across the country. The sector, which added 174,000 last month, saw about 75% of that growth in the hospitality and drink sectors.
Despite total employment growth of 3.6 million over the past four months, food and drink employment has declined 2.5 million since February.
Professional and business services involving a wide variety of professionals, from engineers and architects to consultants and lawyers, have created 197,000 jobs. Temporary agency services accounted for more than half of that recovery, or 106,000 jobs.
– CNBC's Nate Rattner contributed to the coverage.