Highlights:

• Employment growth was well below expectations (266k versus 900k+). The increase in reopening sectors was offset by losses in temporary help and delivery/transportation.
• However, the increase in the participation rate and the upbeat message from surveys show that the recovery is intact. Surveys point also to the risk of bottlenecks, but wage data do not show overheating yet.
• The data are consistent with the Fed’s call for patience and should temper expectations of an early key rate lift-off.
• We developed a visual tool gauging the path towards full and inclusive employment, which monitors the evolution of the main labour market aggregates and the breakdown by workers’ categories. It shows that employment growth is outpacing the recover in labour market participation, but this is not leading to wage pressures.

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