The Bureau of Labor Statistics reported Friday that nonfarm employment rose by 638,000 in October, considerably more than experts had expected, but still a sign that economic growth is slowing. The headline unemployment rate fell to 6.9%. The number of unemployed fell by 1.15 million to 11.1 million. Both of those figures have fallen for the past six months, but they are still double what they were in February before pandemic-induced measures shuttered large parts of the economy. The private sector added 906,000 jobs, while government at all levels shed 268,000, including 147,000 temporary Census workers.
While a marked improvement, the number of jobs is still more than 10 million below what it was before the pandemic. And with cases and deaths from COVID-19 steeply rising, the possibility of more economic lockdowns has been growing, and that would, of course, boost unemployment.
An alternative measure that gauges both unemployment and underemployment fell last month from 12.8% to 12.1%, nearly double what it was in October 2019. The bureau also revised job gains in September from 661,000 to 672,000 and in August from 1.493 million to 1.489 million. The number of long-term unemployed—out of work for 27 weeks or more—increased by 1.2 million to 3.56 million in October while those unemployed for less than 27 weeks fell. That is the highest level since 2014. At 3.7 million, the number of permanent job losers in October changed little over September, but is 2.4 million higher than in February.
It should be noted that each monthly jobs report is based on two surveys—of people and of business establishments—taken in the week that includes the 12th of the month. In other words, the information the report is based on is 3 weeks old.
Olugbenga Ajilore, a senior economist at the left-leaning Center for American Progress, told The Washington Post Thursday, “The economy is at a very tenuous moment. Because there’s no further fiscal relief, we could go back and have another downturn and a loss in GDP. So a lot of it is very dependent on what the federal government does. The economy is still struggling and a lot of people within the economy are still struggling.”
While the rise from the depths of six months ago has been significantly better than expected, the Service industries—the bulk of the economy—nearly halted hiring in the second half of October, the trade group Institute for Supply Management said earlier this week that the service industries which make up the bulk of the U.S. economy just about ceased hiring in October. The scheduling-software company Homebase reported that small-business payrolls fell in the second half of October.
And although some workers are doing fine in the Pandemic Recession, even doing better financially, others are struggling with no good prospects in the immediate future or longer. Without further congressional stimulus directed toward their needs, many of these workers will face even more desperate times. The Wall Street Journal reports:
Just months ago, economists were predicting a V-shaped recovery—a rapid rebound from a steep fall—or a U-shaped path—a prolonged downturn before healing began.
What has developed is more like a K. On the upper arm of the K are well-educated and well-off people, businesses tied to the digital economy or supplying domestic necessities, and regions such as tech-forward Western cities. By and large, they are prospering.
On the bottom arm are lower-wage workers with fewer credentials, old-line businesses and regions tied to tourism and public gatherings. They can expect to bear years-long scars from the crisis.
As was the case with the Great Recession, some workers took years to fully recover economically and some never did.
Here are more data from the October jobs report:
The civilian workforce rose in October by 724,000 after falling by 695,000 in September.
The labor force participation rate fell by 0.3 to 61.7%. The employment-population ratio rose 0.8 to 57.4% in October.
Unemployment rates differ by race and sex. (October percentages in bold; September percentages in [brackets and italics].) Adult men: 6.7% [7.4%]; Adult women: 6.5% [7.7%]; Whites: 6.0% [7.0%]; Blacks: 10.8% [12.1%]; Asians: 7.6% [8.9%]; Hispanics: 8.8% [10.3%]; American Indians: Not counted monthly.
• Average hourly earnings of private-sector production and nonsupervisory employees rose in October by 5 cents an hour to $24.82.
• Average hourly earnings for all employees on private nonfarm payrolls in October rose 4 cents an hour to $29.50.
• Average work week for all employees on nonfarm payrolls remain unchanged at 34.8 hours in October.
• The manufacturing work week in October rose by 0.3 hours to 40.5 hours.
October job gains and losses for selected categories:
- Education and health services: 57,000
° Health care & social assistance: 79,000
- Manufacturing: 38,000
- Professional and business services: 208,000
- Temporary help services: 108,700
- Transportation & warehousing: 63,200
- Financial activities: 31,000
- Leisure & hospitality: 271,000
- Information: -3,000
- Retail trade: 103,700
- Construction: 84,000
- Mining and Logging: 1,000
- Government at all levels: -268,000