Economists predict that the US unemployment rate remained at 6.7% in the first month of 2021, which would be the third straight month without change. Eleven months after the pandemic, 10 months after the job crisis, and nine months after the apparent recovery, this is a very bad sign.
The average expectation for jobs added in January is 50,000. That would be a welcome turnaround from the 140,000 jobs lost in December, the first monthly job loss since April. If the January forecast is accurate, America will still have lost nearly 10 million jobs since February last year.
Wednesday’s ADP employment report found that private payrolls rose 174,000 positions in January, far more than economists expected. And whilethe ADP report and the government report are not correlated,such a big leap bodes well for the official job figures.
Coupled with recent positive surveys of the manufacturing and services sector, “it could be … wait for it … upside risk to Friday’s salary report,” BMO senior economist Jennifer Lee wrote in a note Wednesday.
Here’s to hoping.
On Thursday, the Labor Department reported that weekly unemployment claims fell more than expected in the last week of January, sparking some more optimism about a possible positive surprise in Friday’s jobs report.
All eyes on the rollout of the vaccine
The U.S. labor market has seen a massive rebound since the economy stalled last spring, adding millions of jobs in the summer. Yet the nation remains in a labor crisis.
More than 18 million people received some form of government benefits in the week ending January 9, according to the Labor Department.
Meanwhile, the hospitality and leisure industries – including restaurants and all kinds of personal entertainment – continue to bear the brunt of the crisis.
“In fact, the food services and beverage industry was the biggest source of the employment gap in December and the pre-pandemic,” said Nick Bunker, Indeed’s director of economic research, in an emailed response. In addition, all jobs lost in December were in the hands of women.
The sectors cannot return to normalcy until the virus is under control or the pandemic ends. Economists – and politicians – are betting that the roll-out of vaccines will be the panacea for the economy.
But the rollout is still in its infancy: Nearly 33 million vaccine doses have been administered in the United States so far, but only 6 million people have received the all-important second dose, according to data from the Center for Disease Control and Prevention.
The Congressional Budget Office said in a report on Monday that the number of employed Americans will not return to pre-pandemic levels until 2024.
President Joe Biden’s plans – including a goal to deliver 100 million doses of the coronavirus vaccine in his first 100 days, as well as his proposed $ 1.9 trillion stimulus package that would include more help for the unemployed – couldhelp weather the storm.
But how long it will take for the nation to fully recover from this job crisis – that remains the great unknown.
