Friday, September 29, 2023
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US Added 4.8 Million Jobs in June, Jobless Rate Fell to 11.1%

The American economy added 4.8 million new jobs in June as the unemployment rate ticked down to 11.1%, but a new surge in coronavirus cases this summer threatens to abruptly halt recovery.

(CN) — The American economy added back 4.8 million jobs in June as the unemployment rate ticked down to 11.1%, but a new surge in coronavirus cases this summer threatens to abruptly halt recovery.  

The gains reported Thursday by the Labor Department come after a revised 2.7 million jobs were added in May. In April, more than 20 million jobs were lost as the Covid-19 pandemic forced businesses to close and people to stay at home.

While the number of new jobs in June is the largest single-month gain in U.S. history, the economy has only recovered about a third of the jobs lost during the public health crisis. And another record was set this week: the U.S. reported 50,000 new Covid-19 cases in a single day for the first time on Wednesday.

“Today’s jobs report can easily deceive you. Almost 5 million jobs were added, but the pace of job creation is almost certainly not going to keep up,” wrote Nick Bunker, economic research director at Indeed Hiring Lab. “Yes, the unemployment rate might have declined, but workers are still losing jobs and signs point toward more and more of these losses becoming permanent.”

The leisure and hospitality industry, which includes restaurants and bars, added 2.1 million jobs last month, easily the biggest gain of any sector. But those businesses could be in trouble again as states like Texas close bars amid a spike in new virus cases.

“While it’s great to see job growth in the sector that was directly in the line of the coronavirus, leisure and hospitality employment is still 29% below pre-pandemic levels. With virus cases spiking and businesses potentially closing once again, these gains in employment may not be sustainable moving forward,” Bunker said.

The retail sector added 740,000 positions in June, while education and health services added 568,000 jobs and the manufacturing industry added 356,000.

Gains were also seen in professional and business services (306,000), construction (158,000) and transportation and warehousing (99,000).

At an impromptu White House press briefing Thursday morning, announced only 30 minutes ahead of time, President Donald Trump lauded the jobs report as “spectacular news for American workers and American families and for our country as a whole.”

“Today’s announcement proves that our economy is roaring back, it’s coming back extremely strong,” Trump said. “We have some areas where we’re putting out the flames, or the fires, and that’s working out well.”

While the president took no questions from reporters, he briefly mentioned the continued federal response to the Covid-19 pandemic. He said ventilators would continue to be mass-produced by some American factories as companies are shipping protective equipment to other countries that can’t produce their own.

“All of these people are working with governors and local officials to restore best practices and that’s what we’ve done,” Trump said. “That includes face covering, social distancing, testing and personal hygiene. Wash your hands.”

Trump also said consumer confidence is on the rise and argued it would be higher if consumers didn’t hear as much about economic troubles in the news.  

“With all we go through, with all of the trials and tribulations that we read about every night, much of it totally fake news, unfortunately,” he said. “And if the consumer didn’t get it, you would have good consumer confidence.” 

Former Vice President Joe Biden, the presumptive Democratic presidential nominee, said during a livestream Thursday he was surprised Trump didn’t mention the U.S. hitting a daily record Wednesday for new Covid-19 cases. The struggling economy is still “in a deep, deep job hole” because of Trump’s sluggish response to the pandemic, he said.

“For everyone whose job hasn’t come back, for everyone who doesn’t own stock, who can’t get the sweetheart loan through connections, does this feel like a victory?” Biden said. “For parents who are worried that kids can’t go back to school in the fall, do you feel like this is mission accomplished? Or for the people in states where Covid-19 is spiking, we’re seeing record-high numbers of infections, do you feel like this crisis is under control?”

Biden also pointed to racial inequalities during the economic downturn.

“President Trump touted the job gains for African American workers. But unemployment for black men actually rose from 15.5% to 16.3% in June,” he said. “He touted the numbers for Latino unemployment, but those numbers are still more than three times higher than they were before the crisis started.”

The former vice president added, “Millions of Americans are still out of work wondering when or if their job will come back or worried about how to pay the bills in the meantime. Trump wants to declare his health crisis over and unemployment solved. Unfortunately he’s deadly wrong on both fronts.”

The report on new jobs last month lags behind more recent data because it is based on information collected in mid-June. The Labor Department also reported Thursday that 1.4 million more Americans applied for unemployment benefits last week, which is not reflected in the June jobs report.

Elise Gould and Heidi Shierholz, senior economists at the nonprofit think tank Economic Policy Institute, emphasized that the economic recovery has a long way to go.

“Even with these mild improvements, a large jobs deficit remains. Payroll employment remains 14.7 million lower than it was in February, and the unemployment rate is 7.6 percentage points higher than it was in February,” they wrote.

The economists said Congress needs to act to protect workers and provide more aid to state and local governments.

“We are not ambiguously on an upward trajectory. Policymakers would do well to provide safeguards so that workers and their families can heed the advice of health experts without sacrificing their economic well-being,” Gould and Shierholz wrote.

Categories / Business, Economy, Health, National

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