The job market showed a small improvement in January, according to the monthly report of the Bureau of Labor Statistics released Friday morning. Emphasis on small. And even that gain is deceptive. The bureau calculated a seasonally adjusted gain in the nonfarm employment level of just 49,000, in the private sector just 6,000 against a rise of 43,000 in the public sector. That still leaves 9.9 million Americans out of work who were employed before the pandemic struck. There was a rise in the number of people who have been out of work for six months or more. Some haven’t drawn a paycheck since mid-March 2020. But most troubling is that the paltry gains occurred as 406,000 people left the workforce. This is why the headline unemployment rate fell 0.4 points to 6.3%, not because the job market actually improved. Compared with January 2020, there were 4.3 million fewer Americans in the workforce last month. A BLS measure that gauges both unemployment and underemployment fell 0.6 to 11.1%.
The leisure and hospitality sector of the economy, which showed the biggest drop in December, revised to a loss of 536,000 from the previous calculation, also took the biggest hit in January, shedding another 61,000 jobs. The biggest gains for the month were in temporary help services at 80,900. As usual, the BLS revised its job count for the previous two months, and that was not good news. For December the tally fell from a loss of 140,000 to a loss of 227,000, and in November from a gain of 336,000 to 264,000. In addition, regular benchmark adjustments revised the nonfarm employment level for March 2020 downward by 250,000.
None of these statistics show how bad the situation really is. As of December, as Heidi Shierholz at the Economic Policy Institute pointed out, the number of workers being hurt by the limping labor market was 26.8 million workers—15.8% of the workforce—either completely jobless or employed but experiencing a drop in hours and pay. January’s gains did little to change that.
Because of coronavirus vaccinations, many analysts say they believe the broad economy might be back to normal by late summer, with gross domestic product reaching as much as 4.6% for the entire year. But recovery in the job market will be slower. Much slower, according to a report from the Congressional Budget Office released Monday that predicts that “the number of people employed returns to its pre-pandemic level in 2024.”
Such predictions frequently turn out wrong, and the CBO’s authors concede there is a great deal of uncertainty in such extended forecasts. For one thing, changes in government policies can alter the trajectory substantially. But given the slow job gains in the aftermath of the Great Recession a dozen years ago, the CBO’s calculation for our current circumstances seems entirely possible.
One statistic that has stood out for months is the disparity between the number of women vs. men who have left the workforce during the pandemic. In January, the number of men employed rose 233,000, while the number of women fell by 34,000. There were 4.2 million fewer men employed last month compared with January 2020, and 4.4 million fewer women employed compared with a year ago.
In October last year, Pallavi Gogol at NPR reported:
The coronavirus pandemic is wreaking havoc on households, and women are bearing the brunt of it. Not only have they lost the most jobs from the beginning of the pandemic, but they are exhausted from the demands of child care and housework — and many are now seeing no path ahead but to quit working.
Women have made great strides over the years: More women than men are enrolled in college, in medical schools and law schools. [...]
But the uncomfortable truth is that in their homes, women are still fitting into stereotypical roles of doing the bulk of cooking, cleaning and parenting. It's another form of systemic inequality within a 21st century home that the pandemic is laying bare.
Many women, of course, have continued to work three jobs during the pandemic, the one they are paid to do, housework, and parenting. Making their lives easier extends well beyond the pandemic. In an article appropriately headlined “The Primal Scream,” Claire Cain Miller discusses some of the ways at The New York Times.
The bureau also reported:
In January, the share of employed persons who teleworked because of the coronavirus pandemic edged down to 23.2 percent. These data refer to employed persons who teleworked or worked at home for pay at some point in the last 4 weeks specifically because of the pandemic.
In January, 14.8 million persons reported that they had been unable to work because their employer closed or lost business due to the pandemic--that is, they did not work at all or worked fewer hours at some point in the last 4 weeks due to the pandemic. This measure is 1.1 million lower than in December. Among those who reported in January that they were unable to work because of pandemic-related closures or lost business, 12.7 percent received at least some pay from their employer for the hours not worked, little changed from the previous month.
BLS job reports rely on a pair of surveys for their data. The Current Population Report is conducted via phone interviews with 60,000 households to determine the unemployment rate; the Current Employment Statistics questionnaire sent to 145,000 businesses provides information for calculating the number of jobs gained or lost. Formulas are applied to reduce month-to-month differences caused by seasonal ups and downs.
These data provide a snapshot of the job situation that is at least three weeks old since the two surveys are conducted in the week that includes the 12th of each month. Thus, today’s BLS report records changes in the job market that occurred in the last part of December and the first part of January.
Here are more data from the JANUary jobs report:
The civilian workforce fell 406,000 in January after rising 31,000 in December. It is still 4.4 million less than it was in February 2020.
The labor force participation rate fell to 61.4% in January, while the employment-population ratio rose to 57.5%.
Unemployment rates differ by race and sex. (January percentages in bold; December percentages in [brackets and italics].) Adult men: 6.0% [6.4%]; Adult women 6.0% [6.3%]; Whites: 5.7% [6.0%]; Blacks: 9.2% [9.9%]; Asians: 6.6% [5.9%]; Hispanics: 8.6% [9.3%]; American Indians: Not counted monthly.
Hours & Wages:
- Average hourly earnings of private-sector production and nonsupervisory employees rose in January by 3 cents an hour to $25.18.
- Average hourly earnings for all employees on private nonfarm payrolls in January 6 cents an hour to $29.96.
- Average work week for all employees on nonfarm payrolls rose 0.3 to 35 hours in January.
- The manufacturing work week in January also rose 0.3 to 40.4 hours.
January job gains and losses for selected categories:
- Education and health services: -7,000
° Health care & social assistance: -40,800
- Manufacturing: -10,000
- Temporary help services: 80,900
- Professional and business services: 97,000
- Transportation & warehousing: -27,800
- Financial activities: 8,000
- Leisure & hospitality: -61,000
- Information: 16,000
- Retail trade: -37,800
- Construction: -3,000
- Mining and Logging: 9,000
- Government at all levels: 43,000