Key Highlights
- After losing 227,000 jobs in December, January added 49.000 new jobs
- Unemployment fell from 6.7% in December to 6.3% in January
Slow Going Efforts to Add Jobs in January
The labor force in January 2021 tried clawing its way back after losing 227,000 jobs in December but the going was slow. January’s one-foot-in-front-of-the-next job growth towards adding 49,000 jobs came primarily from business, finance and professional services while bars and restaurants continued moving backwards.
This improvement from December’s surprisingly high 227,000 job losses kicked the unemployment rate down from 6.7% in December to 6.3%.
According to the US Labor Department,another 1.1M people filed new claims for state unemployment benefits. While there are nearly 10M fewer people on today’s payrolls than pre-pandemic, hundreds of thousands of former workers have simply left the work force entirely.
Joblessness Continues to Reflect Disparities among Minorities and Women
As the pandemic continues to hit sectors where people of color are more likely to work, the unemployment rate for Hispanics in January stood at 8.6%, exactly double what the rate was one year ago. For Asian Workers, joblessness hit 6.6%, more than twice the rate of 3.1% one year ago. The highest unemployment rate for any major ethnic or racial group was 9.2% for African American workers, up from 6.1% one year ago.
Unemployment for white workers stood at 5.7% in January 2021 but still significantly up from its level of 3% one year ago.
Women continued to bear the major share of the pandemic’s economic fallout. Women’s participation in the labor force is down -2.1% among all ethnicities and races from last year.
Labor Market Continues to Have Steep Hill to Climb
According to Julia Coronado, president of MacroPolicy Perspectives,“We’re not anywhere close to where we want to be in terms of a healthy labor market. We can’t take this recovery for granted. We want to see numbers that are better than that as we come out of this.”
In Midst of Tepid Job Numbers, Economy Looking Resilient
The Congressional Budget Office’s (CBO)latest report indicated that the nation’s economic output may likely match pre-pandemic levels by the middle of 2021. This CBO report also warned that high unemployment would not recover until 2024.
MacroPolicy Perspective’s Coronado believes aggressive federal relief could provide needed support for this quite fragile economy, small businesses and workers. Coronado said, “You’re thinking, ‘The government’s got my back and I’ve got a source of support,’ whether you’re a small-business owner or somebody who’s had hours cut back or just somebody’s who’s looking at the world and worried about what might happen.”
Thanks to the Bureau of Labor Statistics, US Department of Labor, The New York Times and National Public Radio.
