The U.S. economy surprised analysts on Friday by adding about 372,000 jobs in June, defying expectations that job creation would slow as recession fears loom large.

The U.S. Labor Department shared its latest nonfarm payroll report’s findings Friday, demonstrating that job growth has not yet waned despite persistent inflation and a tighter monetary policy environment. In a show of strength, it left the Dow Jones estimate of 250,000 positions being added in the dust.

According to the data, the unemployment rate hovered around 3.6% for the fourth consecutive month and most groups saw only minor changes to their unemployment status. The figures for labor force participation held steady at 62.2% and the number of job-seekers remained unchanged at 5.7 million individuals.

This news represents a small bright spot against the backdrop of widespread concerns that the U.S. economy will fall into a recession in the near-term. For months, markets have braced themselves for a downturn in response to the Federal Reserve’s determination to temper inflation by hiking interest rates.

However, the tightness of the labor market could, in fact, add to recessionary concerns. Fed Chairman Jerome Powell has previously warned that the labor market was “tight to an unhealthy level,” given the imbalance between labor demand and supply.

Powell has maintained that his ultimate goal remains a restoration of price stability, but he cautioned that achieving this may require more “involuntary churn” in the labor market. In a press conference in June, Powell said the central bank to take more steps to moderate the level of demand for workers that is contributing to inflation.

"Right now, [labor] demand is substantially higher than available supply, though. So we feel that there’s a role for us in moderating demand. Those are the things we can affect with our policy tools," said Powell.

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