Key Highlights
- Economy gained 638,000 jobs in October
- Unemployment fell from 7.9% in September to 6.9% in October, according to US Labor Department
Slowly, slowly, slowly the economy is continuing to heal. During the month of October, the labor market added 638,000 jobs in October, according to the US Labor Department. (This number of job gains would have been higher but the labor market also lost some 147,000 temporary census jobs.) Also in October, the unemployment rate dropped to 6.9% from September’s 7.9%.
Since 22M jobs were lost in the blink of an eye during March, just over 11M jobs, or 54%, have been recovered. Gains, however, have been slowing in the near recent months…1.8M jobs were added in July, 1.5M were added in August, job gains dropped to 672,000 in September and in October, 638,000 job gains.
The Economic Policy Institute estimates that more than 30M workers have either lost their jobs or seen their incomes reduced due to reduced hours.
Diane Swonk, chief economist with the accounting firm Grant Thornton in Chicago, said, “It (October’s monthly jobs report) is better than expected, but we’re starting to see headwinds. The drop in the unemployment rate is welcome news, but there are still over 11M unemployed workers.”
One of the headwinds to which Swonk is referring in the above quote is that the US Labor Department saw the number of long-term unemployed (unemployed for 27 weeks or longer) grow in October to 3.6M from 1.2M jobless workers in September.
Jerome Powell, Chairman of the Federal Reserve, commented about this long-term unemployment by saying, “The record is if you don’t get back in (the job market) fairly quickly, it can be harder to get back in. And that holds down the whole economy…”
Headwinds also include the reality that outdoor eating and drinking will soon be curtailed due to cooler weather. Plus, the seemingly omnipresent coronavirus is again surging at levels not seen before, even in COVID’s spring/summer darkest days. Already hard hit industries like restaurants, hotels and airlines will likely be damaged again.
Though the retail sector was one of the drivers of job gains in October, retailers are not offering the number of jobs hoped for as they gear up for holiday spending. According to Daniel Zhao, senior economist with Glassdoor, said, “This (reduced number of retail job openings) could point to more muted spending and hiring.”
Swonk weighed in again by saying, “We’re getting into a period which should be one of celebrations and travel for the holiday season. That’s not going to happen.”
Thanks to The New York Times and National Public Radio.
Also read: “Scattershot Re-openings” Still Leading to 2.9M More Layoffs, Inside Unemployment Stats & Where Workers Are Being Hired, Nearly 900,000 Filed New Unemployment Claims Last Week
