CBS News — Hiring slowed in July as coronavirus spread throughout many parts of the country, government figures indicate.
Employers added 1.8 million jobs last month, the Labor Department said Friday. While that figure would represent a blockbuster month in normal times, it means that only about 40% of the country’s jobs lost during the March and April shutdowns have been regained. It is also a slowdown from May and June hiring, which saw 4.8 million and 2.7 million jobs added, respectively, as businesses reopened.
The unemployment rate dropped from 11.1% to 10.2%, almost a full percentage point. Still, a 10.2% unemployment rate exceeds the highest rate during the 2008-2009 Great Recession.
That official unemployment rate also masks the true number of people who lost jobs in the recession, noted Heidi Shierholz, a former Labor Department economist and director of the Economic Policy Institute. A truer unemployment rate, she said, would be 13.8% if one included the 5 million people who have left the labor force since February and another 1.3 million who she said were wrongly classified as employed.
July job gains were led by hiring in sectors like leisure and hospitality, education, government and professional and business services. But no industry has so far recovered all the jobs it lost since March.
“This is not a V-shaped recovery. Adding 1.8 million jobs is not sufficient for any sort of speedy recovery after the astronomical job losses of early spring,” Nick Bunker, research director at Indeed, said in a note. “Progress is being made, but the pace has slowed and there’s still a ways to go.”
Unemployment rates ticked town for all the major demographic groups, but fell the most sharply for White and Hispanic workers. It remains highest for Black workers, at 15%.
While July’s numbers beat many economists’ expectations, they also illustrate the depth of the coronavirus recession this spring.
“This was a very positive employment report, but the drop in the job market was so severe in March and April the nonfarm payrolls remain 12.9 million below the February peak,” David Berson, chief economist at insurance company Nationwide, said in a note. “It is likely to take 2-3 years before the job market approaches that prior record, even with solid monthly job gains.”
First published on August 7, 2020 / 8:45 AM
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