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WASHINGTON (AP) – The abundant evidence in the November jobs report indicates the attempt to recover the U.S. economy is faltering as coronavirus cases accelerate and federal aid runs out.
Hiring has slowed down considerably. Hundreds of thousands of people have given up looking for work. The proportion of the unemployed who have been unemployed for at least six months has increased.
In total, the Labor Department said Friday, employers created 245,000 jobs in November – the least since April, the fifth consecutive monthly slowdown and well below the gain expected by economists.
In March and April, when the virus slammed the economy, the United States lost 22 million jobs. It has since recovered them, but at an ever faster rate: 4.8 million jobs added in June, 1.8 million in July, 1.5 million in August, 711,000 in September, 610,000 in October and 245,000 in November.
The total is up and the US economy is still short of 9.8 million jobs from the jobs it had in February.
In the meantime, the viral epidemic continues to worsen. The country currently suffers an average of 189,000 new confirmed infections per day, down from less than 35,000 three months ago. States and towns are placing restrictions on businesses and persuading more Americans to stay home, which means less money spent and fewer jobs needed.
What’s more, 9 million people could lose all their unemployment benefits on Boxing Day – unless Congress approves a rescue package before then. Capitol Hill negotiators are seeking a deal.
“The US labor market experienced a major slowdown in November due to the second wave of the coronavirus,” Sal Guatieri, senior economist at BMO Capital Markets wrote on Friday.
Here are five takeaways from the November jobs report:
UNEMPLOYMENT FALL FOR MISTAKE
The unemployment rate fell to 6.7% last month, from 6.9% in October. This is the lowest rate since the March outbreak. But the explanation is not encouraging: 400,000 Americans stopped working or looking for work in November. Because these people were not actively looking for work, they were not considered unemployed. In fact, 74,000 fewer Americans told the Department of Labor they were employed last month.
The proportion of adults working or looking for work – what economists call the labor force participation rate – fell to 61.5% last month, from 61.7% in October.
JOB LOSSES BECOME PERMANENT
Many of the job gains since April have come from companies recalling workers they laid off when the pandemic hit. The trend continued last month. The number of Americans on temporary layoff fell from 441,000 to less than 2.8 million, from a peak of 18.1 million in April.
But permanent job losses continued to pile up. This suggests that the coronavirus recession will leave lasting scars on the job market. The number of Americans who consider themselves permanently laid off increased from 59,000 to 3.7 million, from just 2 million in April. And the number of people out of work for six months or more rose last month from 385,000 to 3.9 million, more than four times 939,000 in April.
These long-term unemployed now represent about 37% of the unemployed in the United States. This is the highest proportion of this kind since 2013.
TURMOIL OF DETAIL PERSISTS
Retailers face declining walk-in traffic and increased competition from e-commerce as Americans stay at home. It showed last month: Retailers have lost nearly 35,000 jobs. They now employ 550,000 people less than in February. The coronavirus crisis has forced a number of well-known retailers to seek bankruptcy protection, including Brooks Brothers and JC Penney.
Conversely, the surge in online shopping sparked a boom in hiring in warehouses and transport companies: they created 145,000 jobs in November, the most a month since 1997.
WANTED: CONSTRUCTION WORKERS
Builders added 27,000 workers last month, up from 72,000 in October and 35,000 in September.
Fueled by record mortgage rates and pent-up demand from buyers, the housing market is defying the coronavirus. Residential construction rose 4.9% in October after rising 1.9% in September.
Sales of existing homes have increased for five consecutive months. In October, sales hit their highest level since February 2006, shortly before the housing crisis that triggered the Great Recession of 2007-2009.
GAINS FOR BLACK AND HISPANIC WORKERS
Last month, employment increased by 136,000 jobs for black workers and 83,000 jobs for Hispanics, but fell by 508,000 for whites. (The racial breakdown comes from a separate survey from one that showed the economy gained 245,000 jobs last month; the two surveys sometimes diverge from month to month.)
In addition, 662,000 whites and 33,000 Hispanics dropped out of the workforce last month, while 48,000 African Americans jumped out.
Still, the unemployment rate remained much lower in November for Whites compared to others: 5.9% unemployment compared to 10.3% for Blacks and 8.4% for Hispanics.
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