U.S. economy adds 638K jobs in October, as recovery slows

The U.S. job market showed a burst of strength in October, with employers adding 638,000 jobs and the unemployment rate tumbling to 6.9 per cent.

The job gain suggested that a tentative economic recovery is still intact even as it faces another surging outbreak of COVID-19. October’s increase was slightly below the 672,000 jobs that were added in September and far below the 1.5 million gain in August.

Still, the health of the economy may be better than last month’s headline job numbers would indicate. The overall job tally was held down by the loss of about 150,000 temporary Census jobs.

Excluding government, businesses added 906,000 jobs. Job growth was particularly strong in construction, retail, and a category that includes restaurants and hotels.

The report Friday from the Labor Department said the unemployment rate sank a full percentage point from 7.9 per cent in September.

But the U.S. still has 10.1 million fewer jobs than it did before the pandemic intensified in March. At the current pace of hiring, it would take until February 2022 for the economy to regain the jobs lost to the pandemic.

That would be faster than the 2008-2009 Great Recession, when it took more than five years to recover the jobs eliminated in that downturn. Yet it’s far from clear that employers can maintain – let alone increase – their pace of hiring.

The job market and the overall economy are under intensified pressure from the accelerating pandemic. On Thursday, the nation broke another record in the seven-day rolling average for new cases, hitting nearly 90,000.

Daily new cases were also on track for another day above 100,000, with surging numbers reported all around the country, including a combined nearly 25,000 in Texas, Illinois and Florida.

And the longer unemployment remains elevated, economists worry, the harder it will be for many of those out of work to find jobs. Employers are often reluctant to hire people who have been unemployed for months.

“It was a pleasant surprise to see that the pace of the recovery hasn’t slowed down,” said Nick Bunker, an economist at Indeed, the job search website. “But we all need to keep in mind the huge hole that we’re in, in terms of jobs and unemployment.”

Source: Read Full Article