In 1st Loss Since April, Economy Sheds 140,000 Jobs as Pandemic Worsens and Vaccines Lag

Some 10.7 million people are unemployed, but the figure doesn’t include an additional 7.3 million people who want a job but had not actively looked for work in the past four weeks. Hiring had been slowing sharply since September, signaling a likely contraction and prolongation of the recession.

The standard unemployment rate undercounts the unemployed and underemployed considerably, even though the Labor Department also calculates the more accurate figure, what it calls its “alternative measure of labor utilization,” or the U-6 unemployment arate. By that calculation, the unemployment rate was at 11.7 percent in December. The figure includes the 6.2 million under-employed–people who want or need a full-time job, but whose hours were cut back or who were unable to find full-time work. That figure remains 1.8 million higher than it was before the pandemic.

Overall, the economy is nearly 10 million jobs short of its February level, a figure that does not reflect the natural growth of the labor market in normal times.

Almost a quarter of the nation’s labor force–23.7 percent of those employed–worked from home in December at some point during the four weeks surveyed, up significantly from 21.8 percent the previous month.

While the overall unemployment rate stayed flat at 6.7 million, it rose for teenagers and Hispanics. Sectors most severely affected were the same as in the spring: hotels, motels, bars, restaurants, which saw a loss of almost 500,000 jobs, including 372,000 in restaurants and bars. Amusement parks, gambling and recreation sites lost 92,000 jobs. The industry has lost 3.9 million jobs since February, almost a quarter of its pre-pandemic level.

Private schools and education also saw a 63,000 drop in jobs in December, and public school jobs declined by 20,000. Government employment declined by 45,000, most of that in local government.




Several sectors gained jobs, however, led by professional and business services (161,000), with a large increase in temporary jobs, and retail (121,000 jobs in December), powered by large box stores such as Costco and Sam’s Club. But the sector is still 411,000 jobs below February’s level. Construction added 51,000 jobs, transportation and warehousing added 47,000, and health care added 39,000 jobs, with hospitals regaining 32,000 jobs. But long-term care facilities such as nursing homes and assisted living facilities, which have taken the brunt of the covid casualties, were down 6,000 jobs. Manufacturing added 38,000 jobs, and whosesale trade 25,000.

All sectors are still well short of the employment levels in February. Average hourly earnings for all employees on private payrolls
increased by 23 cents to $29.81. The Bureau of Labor Statistics’ analysis says the increase largely reflects the disproportionate number of lower-paid workers in leisure and hospitality sectors who lost jobs, skewing the hourly earnings estimate.




Some help is on the way. Congress in December, again in the absence of presidential leadership, passed a $900 million relief bill that will boost the economy, provide $600 checks to most adults, with support for dependent children, and more subsidies for businesses, though state and local governments were largely excluded from the relief package. The covid-19 vaccine is slowly propagating through the nation. It is expected to provide the most relief and momentum for a return to normal economic activities.

But the combination of the most severe surge in Covid-19 cases and daily deaths (both daily numbers broke new records on Thursday) and the bungled roll-out of the vaccine, which has resulted in supplies by the drip for most communities, portends a difficult winter. The decision by Florida Gov. Ron DeSantis–ostensibly a pro-business, pro-economy governor–to prioritize the vaccine for people 65 and over, to the exclusion of front-line workers in essential industries and sectors, also means that the job sectors that need protection most will not be getting vaccine relief for months, thus further delaying public confidence in frequenting many businesses.