American companies added more workers than forecasters predicted for August as the latest jobs report ensures the Federal Reserve will continue its hawkish policy in an effort to rein in record levels of inflation.

The Labor Department said on Friday that nonfarm payrolls rose by 315,000 jobs, though unemployment slightly ticked up by 0.2% to 3.7% compared to July.

The jobless rate continues to hover at record lows as the nation’s economy has recouped the number of jobs lost during the coronavirus pandemic.

In July, US employers added a whopping 526,000 jobs.

Initially, the jobs report sent the Dow soaring by as much as 370 points, but the markets pulled back. The Dow plunged 337.98 points, or 1.1%, while the S&P 500 also lost 1.1%.

The strong jobs report all but guarantees that Fed Chair Jerome Powell will announce an interest rate hike later this month.

Wall Street analysts said there’s a 60% chance that Powell will raise rates by 75 basis points at the end of this month’s Fed meeting, though the latest jobs report does open the door for a slightly less aggressive move.

“The Fed will require further proof of softening before adjusting policy materially,” David Page, head of macro research at AXA Investment Managers, told CNN.

“But on balance these figures are consistent with a 50-basis point September Fed hike.”

Last week, Powell told reporters gathered to cover the central bank’s annual symposium in Jackson Hole, Wyo., that American households and businesses can expect to experience “pain” and job losses in the fight to bring down red-hot inflation.

“These are the unfortunate costs of reducing inflation,” Powell said. “But a failure to restore price stability would mean far greater pain.”

The Fed chair made clear that he expects rates to remain at levels that should slow the economy “for some time.”

After hiking its key short-term rate by three-quarters of a point at each of its past two meetings, part of the Fed’s fastest pace of rate increases since the early 1980s, Powell said the Fed might ease up on that pace “at some point” — suggesting that any such slowing isn’t near.

Since March, it has lifted the rate from near zero to its current range of 2.25% to 2.50%.

Despite rising recession risks, the labor market remains stubbornly strong.

There were 11.2 million job openings on the last day of July, with two job openings for every unemployed person.

First-time applications for unemployment benefits are running very low by historical standards.

With Post wires