Unemployment and job growth show strong improvement, but coronavirus darkens the outlook

From today’s Los Angeles Times:

The U.S. economy added a larger-than-expected 4.8 million jobs in June despite the worsening COVID-19 pandemic, registering solid gains for the second straight month after suffering near-Great Depression losses in the spring, the government reported Thursday.

Reflecting the June increase, the nation’s unemployment level fell to 11.1% after hitting 13.3% in May and 14.7% in April.

While the back-to-back months of improving numbers offered a spot of hope, they may be an uncertain guide to the future. Coronavirus cases, as well as hospitalizations and infections among younger Americans, have been exploding in California and other states across the West and South.

As a result, many areas that were reopening for business, and thus beginning to call back workers, are reversing course and imposing restrictions again. “This report may be a kind of high point,” said Heidi Shierholz, a former Labor Department chief economist now at the Economic Policy Institute.

California’s employment numbers for June will be released July 17, and are likely to mirror the national trend, albeit at a weaker pace. The state’s jobless rate for May was 16.3%, little changed from April, as job creation lagged somewhat. Unemployment in Los Angeles County was 20.9% in May.

Even with the June gains, joblessness overall remains higher than at any time since the Bureau of Labor Statistics’ records began in 1948. Jobless rates dropped across the board, but disparities remain significant. Black unemployment was 15.4% compared with 14.5% for Latinos, 13.8% for Asians and 10.1% for white people. Unemployment for college graduates was down to 6.9% versus 12.1% for workers with only a high school education.

The Bureau of Labor Statistics said the overall unemployment rate for the nation might actually be 1 percentage point higher than the 11.1% reported due to complications in survey collection. Misclassification of workers’ status had resulted in a much bigger undercount of the unemployed in the prior two months.

Read the complete article here.