US employers took back another 4.8 million workers last month when the economic impact of the coronavirus pandemic seemed to lessen, marking the second consecutive month of job growth. But the latest figures predate new waves of infections that threaten a fragile recovery.
The United States Department of Labor announced Thursday that the unemployment rate fell to 11.1% in June from an initial estimate of 13.3% in May. The figure is still more than three times higher than the 3.5% unemployment rate in February before the outbreak in the United States.
In a separate report, the labor department said another 1.4 million Americans applied for unemployment benefits last week. In the past two weeks alone, another 3 million Americans have applied for unemployment benefits.
Donald Trump, who has pushed for a faster reopening despite growing cases of coronavirus, celebrated the employment numbers. “Historic Job Numbers! #MAGA, “he wrote on Twitter.” Our economy is booming, “Trump told reporters at the White House, adding that he was” really happy. “
Donald J. Trump
(@realDonaldTrump)HISTORICAL JOB NUMBERS! #MAGA pic.twitter.com/ncAkWV0D2c
July 2, 2020
The monthly figures are a snapshot of the second week of June, when the US states reopened their doors after weeks of blockades aimed at containing the spread of Covid 19. Leisure and hospitality earned 2.1 million jobs in June, about two-fifths of all earnings. , with a job in food services and drinking places in 1.5 million jobs.
Since the figures were compiled, many states, including California, Texas, Florida, and New York, have slowed or reversed reopens as coronavirus cases increased.
The latest job numbers come as Congress appears blocked by a new round of economic stimulus to help those who have been laid off. Although unemployment fell in May and June, 12 million jobs have been lost since February.
“I’ve never seen anything like this,” said Seth Harris, acting secretary of labor for Barack Obama. Harris said that as the search for a cure continued, it was vital that states and the federal government work to find a way to reopen the economy safely and agreed to inject more stimulus money.
Much of the US stimulus package has now been spent and a plan that gave an additional $ 600 a week in unemployment insurance runs out in late July. “That $ 600 is $ 12 billion a week in spending for the United States economy,” said Harris. “Seventy percent of the United States economy is consumption. If consumers don’t have money, the economy suffers. “
Without that $ 600, Michael Hessel-Mial, an associate professor and independent professional living in Kansas City, Missouri, said his state’s insurance would give him $ 350 a week, enough to cover rent and basic expenses.
“I would never be able to pay for my public services and insurance again,” Hessel-Mial said, while their chances of finding a new job have decreased as colleges and universities have fired staff members and instituted hiring freezes.
While Hessel-Mial has not yet received her unemployment insurance, her application was recently approved by the state, one month after applying for the insurance. With the instability of working on a contract basis with their employers, many of whom have cut their self-employed and attached budgets, knowing that they can get money to pay their bills has brought momentary relief.
“Just the very idea that I could get unemployment that could finally help me pay my bills and not get caught up in debt, as I prepare for the next job, just the idea of having that is an emotional burden that I couldn’t. I imagine, ”said Hessel-Mial. “It seems like this is what we should have had all along.”
The mosaic approach to reopening the United States has failed.
States, including Georgia and Florida, that reopened before the virus was under control are now experiencing sudden increases in infection rates, and new quarantine controls are closing businesses, causing further job losses. Even when those states reopened, their economies did not recover, Harris said. Fear meant that people stayed home.
An investigation by Harris and the Remesh research company found that only one in three American employees believe it is safe to return to work.
“The American people deeply fear coronavirus and are right to be afraid,” said Harris.
The pandemic has proven to be a unique challenge for the Bureau of Labor Statistics (BLS). A record number of people are now classified as not on the job for “other reasons,” a category that is not included in the overall unemployment rate.
About 5.4 million workers with a job but not on the job were included in the “other reasons” category in May. That is 4.9 million more people in the “other” category than the average for the month of May between 2016 and 2019.
If all of these “others” were included in the unemployment statistics, the unemployment rate for May would have been 16.4%, not 13.3%. As the BLS noted in a blog post, not all of those “others” are unemployed. The discrepancy in the ranking “decreased significantly” in June, according to the BLS, making the real unemployment rate only about 1 percentage point higher than the reported level.
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