The economy's hot vax summer is going strong

• July's jobs report showed that the US added nearly a million jobs last month.
• Wages and consumer demand have also shown strong growth this summer.
• The economic reopening has been booming for several months, so hot vax summer was on when the Delta variant spiked.

After a year of pandemic lockdowns, America was looking forward to a "hot vax summer" as inoculation against the coronavirus and reopening coalesced into an economic boom.

That narrative was questioned in late July and early August, as the surging Delta variant of the coronavirus suddenly raised fears of going back into lockdown. The economic data is clear, though: Hot vax summer is very real.

Data throughout the summer has showed a boom in employment, consumer demand, and wage growth. While there have been a few snags caused by supply shortages, and the Delta variant raises big questions for the rest of the summer and the fall, so far the recovery has been impressively fast. Friday's jobs report is the cherry on the proverbial ice-cream sundae.

Here's the best of all the good news coming out of the US's hot economy.

Jobs are coming back fast

The labor market is hot. After losing over 22 million jobs in March and April 2020, the economy has been adding jobs back at a steady clip. Friday's jobs report showed that the US added 943,000 jobs in July, and revisions to previous data showed that June actually saw nearly as many: 938,000 jobs, revised significantly upward from the initial read.

While there are still about 5.7 million fewer Americans on payrolls than in February 2020, at the current average rate over the last three months, all those jobs will be recovered by February of next year:

Even accounting for the jobs that would have been created in the economy following the pre-pandemic trend, the labor market should be back on track by next summer, Indeed economist Nick Bunker wrote on Twitter.

Those job gains happened across nearly all industries, with the hard-hit restaurant and hotel sector adding another 380,000 jobs last month.

Americans are getting paid more

The July jobs report also showed that workers are seeing big raises as employers raise wages to attract and keep employees amid the labor market boom.

Average wages among all private-sector workers rose 4.0% between July 2020 and July 2021, a much faster pace than the pre-pandemic average year-over-year growth rate of 3.1% in 2019.

Restaurant and hotel workers saw an astonishing 9.6% increase in wages over the year. That's consistent with another recently published measure of wage growth, which showed a record-high 2.8% increase in leisure and hospitality wages between the first and second quarter of this year alone.

Another measure of personal income released last week by the Bureau of Economic Analysis showed that aggregate wages and salaries paid out rose 10% between June 2020 and June 2021, another sign of both rapidly increasing employment and higher wages.

Of course, inflation has eaten into some of those gains. Prices have been increasing at a fast clip over the last few months, but the overall uptick in wages is still a sign of a booming labor market.

Overall economic activity is growing at its fastest rate in 18 years

The Bureau of Economic Analysis also recently reported that real GDP for the US - a broad measure of all market-based economic activity in the country - grew at a 6.5% annualized rate in the second quarter. While that's lower than the 8.5% growth expected by economists, it's still the fastest rate since 2003, with the crucial exception of the massive bounce back in the third quarter of 2020 after the initial pandemic shock.

A look inside that GDP report shows even more strength than the headline number suggests. Personal consumption expenditures grew at a wild 11.8% annualized rate in the second quarter, as Americans spent the early part of the summer shopping, traveling, and going out to restaurants at a much higher rate.

The labor market is quickly recovering, and so is overall economic output.

Still, inflation and the Delta variant threaten

While the economy has been booming so far this summer, there are of course a few potential snags. Inflation has been running hot over the last few months, fueled by the massive increases in demand as well as supply chain issues for things like computer chips and cars. However, it's likely that those rising price pressures will subside as the economy gets back to normal.

Another threat is the rising number of COVID-19 cases in the US, fueled by the extremely contagious Delta variant. If consumers and employers become wary of new threats of infection or potential lockdowns, economic activity could slow down through the rest of the summer and into the fall. However, the extent of the variant's effects on the economy remains to be seen, and it's possible that the underlying strength seen above could carry through.

The American economy's hot vax summer has been not only real, but a historically impressive boom.