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WASHINGTON: US hiring surged to a record high in May and layoffs fell as businesses reopened, but the improvement in the labour market is likely to be blunted by a resurgence in Covid-19 cases that has forced some enterprises to shut down again.

The report from the Labour Department on Tuesday also showed a rebound in job openings, a measure of labour demand, which economists said was difficult to square with the 31.5 million people collecting unemployment checks in mid-June.

"The labour market is hard to read right now with many cross-currents and anomalies as the country starts to get back up to speed," said Chris Rupkey, chief economist at MUFG in New York.

"It is hard to imagine these millions of job postings across the country are real. Our guess is many of the openings are merely leftovers from the best labour market in 50 years at the start of a year."

The monthly Job Openings and Labour Turnover Survey, or JOLTS, report showed hiring accelerated by 2.4 million jobs to 6.5 million, the highest since the government started tracking the series in 2000. The hiring rate jumped to an all-time high of 4.9% from 3.1% in April.

The report followed on the heels of news on Friday that the economy created a record 4.8 million jobs in June. Nonfarm payrolls have rebounded after a historic plunge of 20.787 million in April as the labor market reeled from the closure of businesses in mid-March to slow the spread of the coronavirus.

But the upswing in hiring has been overtaken by record spikes in new Covid-19 infections in large parts of the country, including Arizona and the highly populated states of California, Florida and Texas, which have forced several jurisdictions to scale back or pause reopenings and send some workers back home.

Even with the record hiring over the past two months, employment is 14.7 million jobs below its pre-pandemic level.

Hiring in May was driven by the accommodation and food services industry. There were also increases in the healthcare and social assistance and construction businesses. With hiring rebounding, layoffs and discharges tumbled 5.9 million to 1.8 million in May. The accommodation and food services industry accounted for the bulk of the decline in layoffs. There were also decreases in the retail sector.

The layoffs and discharge rate dropped to 1.4% from 5.9% in April. The layoffs rate hit a record high of 7.6% in March.

Economists noted that the 1.8 million layoffs in May was much lower than the more than 8 million new applications for the regular state unemployment insurance (UI) benefits recorded during the month.

Job openings increased 401,000 to 5.4 million on the last business day of May. There were increases in vacancies in the accommodation and food services, retail and construction industries. The rise was in the South region, which reopened businesses quicker than other parts the country. The surge in new coronavirus cases is concentrated in the South.

The number of people voluntarily quitting their jobs increased 190,000 to 2.1 million. The quits rate, which is viewed by policymakers and economists as a measure of job market confidence, rose to 1.6% from a nine-year low of 1.4% in April.

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