Employers Add Only 49,000 Jobs, Signaling Long Road to Recovery | Courthouse News Service
Thursday, November 30, 2023
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Employers Add Only 49,000 Jobs, Signaling Long Road to Recovery

Paltry increase in jobs driven by gains in the government sector and the professional and business services industry, signaling long road to recovery.

(CN) — The U.S. economy added back just 49,000 jobs in January, recovering only a fraction of what was lost the month before.

The meager uptick in the final weeks of Donald Trump’s presidency falls well below economist predictions of about 100,000 job additions, though it is a significant improvement over the revised 227,000 positions lost in December.

The unemployment rate dropped 0.4% to 6.3% last month, according to a Labor Department report released Friday. But the decrease is due in part to some people having stopped looking for work, so they were no longer counted as jobless.

“This is not a good start to 2021,” said Nick Bunker, economic research director at Indeed Hiring Lab. “Not only was payroll growth slow, but the gains were relatively concentrated in certain sectors. Compared to last month, we are adding jobs. However, more industries shed jobs in January than added them.”

Bunker said the disappointing report shows the jobs market “is treading water.”

“You can tread water for a while when you are close to shore, but you cannot do it when you are miles away. The labor market is miles away from where it needs to be,” he wrote.

Most of the gains last month came in the professional and business services sector, which added 97,000 jobs, as well as the information and wholesale trade industries, which added 16,000 and 14,300, respectively.

But the leisure and hospitality industry, which has been hardest hit by the coronavirus pandemic, shed another 61,000 jobs, while retailers lost 37,800. Big losses were also recorded in health care and social assistance (40,800) and transportation and warehousing (27,800).

Overall, the private sector had a net gain of just 6,000 jobs in January while government employers added 43,000 positions.

There are still 9.9 million fewer American jobs compared to this time last year, before the Covid-19 crisis kept consumers at home and forced many businesses to close.  Over 20 million jobs were lost in April 2020 alone.

President Joe Biden hopes to breathe new life into the economy with a $1.9 trillion stimulus package that includes $1,400 checks for most Americans and an extra $400 weekly in unemployment benefits.

The Senate narrowly passed a budget resolution early Friday morning that will allow Democrats to fast-track the relief bill without Republican support. The 5:30 a.m. vote was 51-50 along party lines, with Vice President Kamala Harris casting the tie-breaking vote after a lengthy process where senators can offer as many amendments as they want

Democrats aim to get a final bill to Biden’s desk before unemployment benefits expire on March 14.

Elise Gould, senior economist at the Economic Policy Institute, said lawmakers “need to go big to solve this crisis,” including by extending unemployment aid and providing more federal funds for state and local governments.

“Today’s jobs day report reinforces the need for Congress to take bold action in passing crucial relief measures through reconciliation,” she wrote.

She emphasized the lower unemployment rate doesn’t take into account those who have left the workforce or people who were counted as employed but who weren’t at work or had their hours cut.

“Taking all those workers into account, a total of 25.5 million workers—15.0% of the workforce—were directly hurt by the Covid downturn in January,” Gould said. “This proves essential the need for extensions to unemployment insurance to provide a necessary lifeline to those workers and their families.”

Categories / Economy, Employment, National

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