Employers added a stunning 528,000 jobs in July, while the unemployment rate ticked down to 3.5%, the lowest level in nearly 50 years, the Labor Department said on Friday.

Why it matters: It’s the fastest pace of jobs growth since February as the labor market continues to defy fears that the economy is heading into a recession.

• Economists expected the economy to add roughly 260,000 jobs in July.
• Job gains in May and June were a combined 28,000 higher than initially estimated.

The backdrop: The data comes at a delicate time for the U.S. economy. Growth has slowed as the Federal Reserve raises interest rates swiftly in an attempt to contain soaring inflation.

• Many economists and Fed officials alike are pointing to the ongoing strength of the labor market as a sign the economy has not entered a recession.
• Policymakers want to see some heat come off the labor market. They are hoping to see more moderate job growth as the economy cools, in order to ease inflation pressures.