Key Highlights
- US economy close to getting back on track
- Despite last month’s disappointing jobs report, hiring on track to achieve “launching point” by end of August 202
Compare Jobs Numbers
In February 2020, pre-pandemic, there were 152,523,000 nonfarm payroll workers.
In May 2021, there are 144,308,000 nonfarm payroll workers
Compare Job Openings
During the previous expansion, by the way the longest economic and job expansion in our country’s history, the all-time high for job openings was 7,574,000.
Today, there are approximately 7,367,000 job openings. This number is expected to reach 10M job openings by the end of this current new expansion.
Today, there are some 5.5M more job openings than during the worst levels of the great financial crisis. This is happening despite April’s disappointing jobs report.
Expectations About Interest Rates
The Federal Reserve has repeatedly maintained that it will not hike interest rates until employment numbers reach pre-pandemic employment numbers.
For that to happen, the Fed would likely need to see the employment to population ratio for workers return to approximately 80%.
Currently, this metric stands at 76.9%.
Latest Unemployment Claims as of May 20, 2021
Worker applications for initial unemployment benefits dropped to 473,000 for the week ending May 15 2021. Claims are still above pre-pandemic levels but are now at the lowest level since mid-March 2020.
As of the week ending May 1 2021, there was a total of 16.9M claims for benefits in all programs compared to a total of nearly 21M claims for the comparable week in 2020. Though much improved from last year, this total is nearly eight times as high as pre-pandemic totals.
Additionally, 53 states and territories reported initial 95,086 claims and a total of 6.6M continued weekly claims for the federal Pandemic Unemployment Assistance program. Continued claims for the federal Pandemic Emergency Unemployment Compensation program totaled some 5.1M.
Going in Right Direction
All in all, the economy and jobs are going in the right direction…we’re not there yet but both are on track to get there…wherever there is.
Beth Ann Bovino, US chief economist with S&P Global Ratings, said, “Overall it looks like we’re seeing healing in the jobs market. That’s much better than just over a year ago, but still double what there was pre-crisis.”
Though many economists are expecting employment to close out the year -1.6% lower than in Q4 201 due to the severity of the pandemic, Veronica Clark, Citigroup economist, said there are definitely not as many layoffs happening as were happening before. “It’s a good sign that a return of activity levels is creating a more normal labor market.”
Thanks to the US Department of Labor and The Wall Street Journal.
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