The U.S. gained 850,000 jobs in Juneindicating a major shift towards a recovered vibrant economy. It is the biggest gain in 10 months—and workers’ wages rose briskly, the government said on Friday indicating a renewed demand for the workforce.

The unemployment rate, derived from a separate survey of households, rose to 5.9% last month from 5.8% in May. That was in part because of positive development: A modest number of Americans came off the sidelines and entered the job search, expanding the labor pool. A broader measure of unemployment that takes into account workers stuck in part-time jobs and those too discouraged to look for work fell sharply last month.

The positive employment report was released by the Bureau of Labor Statistics and was cheered by economists.

Economists had expected gains of roughly 700,000 jobs and a drop of 0.1 to 0.2 percent in the unemployment rate as Americans have increased activities like air travel, hotel stay, eating out, and visiting gyms and theatres.

Economists tend to dislike attaching too much weight to a single month’s report since it provides a backward-looking snapshot that can remain volatile even with seasonal adjustments.

“I think it’s likely going to be pretty noisy here over the next few months as we go through the dog days of summer,” said Cliff Hodge, chief investment officer at Cornerstone Wealth.

Policymakers have mostly agreed that current pockets of inflation are transitory. But if job gains are robust and both unemployment and underemployment undergo sustained decreases, worry about rising wages creating inflationary pressure could persuade Federal Reserve Chairman Jerome Powell and the other members of the central bank to lean into its massive bond-buying program sooner rather than later.

Weekly jobless claims data released on Thursday showed initial applications for unemployment fell to a new pandemic-era low of 364,000, while payroll processor ADP reported on Wednesday private-sector job growth of 692,000 for June.

The good news was that more than 330,000, or nearly half, of those new jobs, came from the leisure and hospitality sector.

Small businesses added 215,000 of those jobs, even though the economic activity taking place there — particularly at restaurants and bars, stores, and hotels — has been constrained as business owners struggle to compete for workers with big-box retailers and chain restaurants for hourly workers.

A lack of child care, a skills mismatch, and extended unemployment benefits have been frequently cited as potential deterrents keeping would-be workers from jobs. However, the scenario is now changing as workers are coming back to the labor market—albeit slowly—and employers, desperate to hire to serve a flood of customers, are dangling higher pay and other incentives such as signing bonuses.

Hourly wages among private-sector workers rose 3.6% from a year earlier.