U.S. job growth increased more than expected in June and the unemployment rate remained near pre-pandemic lows, according to government data released on Friday.

Nonfarm payrolls increased by 372,000 jobs in the month while the unemployment rate held steady at 3.6 percent, the Labor Department's closely watched employment report showed. Economists polled by Reuters had forecast 268,000 jobs added.

Average hourly earnings rose by 10 cents, or 0.3 percent, to $32.08, and are up 5.1 percent over the past 12 months, the report said.

Businesses in the vast services industry are scrambling for workers. There were 11.3 million job openings at the end of May, with 1.9 jobs for every unemployed person.

The data will provide little comfort to the Federal Reserve, which has declared war on inflation which is at its highest level in more than 40 years. The central bank has implemented aggressive interest rate hikes to try to cool demand.

In June, it raised its benchmark overnight interest rate by three-quarters of a percentage point, its biggest hike since 1994. Markets overwhelmingly expect the Fed, which has increased its policy rate by 150 basis points since March, to unveil another 75-basis-point hike at its meeting later this month.

(With input from agencies)