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The Latest On The Employment Situation

Updated : August 27th, 2020

The Latest On The Employment Situation

The month of July saw the American economy adding 1.8 million jobs to the total nonfarm payroll. These numbers are a positive indicator as the nation witnessed the restarting of several economic activities throughout the country. Several posts were added to the health care, professional and business services, retail trade, government, leisure, and hospitality verticals. But the employment situation in July is not all that rosy as it may seem. 

On the downside, the unemployment rate is 10.2%, which is higher than the lay-off rate during the Great Recession between 2017 – 2019. Also, the increasing number of cases in South Carolina, Oregon, and Alabama have left job seekers in these states in the lurch. 

The unemployment crisis has been quite severe for the last few months, with the unemployment rate spiking to 14.7% in April. Subsequently, the unemployment rate dropped to 13.3% in May, and 11.1% in June. 

Key Unemployment Stats For July

The unemployment rate in July dropped by 0.9%, capping a figure of 10.2%. With the slight drop in the unemployment rate in July, what now needs to be seen is whether the number drops further in the following months or not. 

Major Ups and Downs in July

Last month saw the service sector adding a majority of jobs. The leisure and hospitality vertical added 592,000 jobs in July, accounting for one-third of the total nonfarm job gains. Another prominent sector is the food services and bars sector. It saw an increased spike in jobs, adding 502,000 jobs in July. But despite the increasing jobs in this sector, the situation is not as good as before the pandemic began.   

The government sector also added 301,000 jobs in July. Also, the public sector education vertical saw an increase of +215,000 jobs in the local government education sector vertical. The state government education sector added +30,000 jobs last month. Since the election season is just around the corner, the federal government also hired +27,000 temporary employees. 

The retail trade vertical also performed quite well last month, adding 258,000 jobs. Most of the jobs in this sector took place in the clothing accessories stores division. Interestingly, the warehouse stores and large shopping supercenters saw a loss of 64,000 jobs.

170,000+ jobs have been added in July in the professional and business services sector. Most of the job gains in this sector occurred in the temporary help services vertical. The other services sector also added 149,000 jobs, with significant gains in personnel and laundry services. 

 Health care has turned out to be one of the most critical sectors in these times by adding 126,000 jobs. The verticals that hired the most were the dentists, hospitals, physician’s offices, and the home healthcare services industry. But job losses continued in the residential care and nursing facilities.

The other prominent sectors that hired talent were social support, transport, and warehousing, manufacturing, financial activities, construction, and mining. Several jobs were also added in the gambling, recreational, and amusement verticals, respectively.

Establishment Survey Data

It is essential to look into the hourly earning and other critical aspects that keep the workforce running in these tough times. The points mentioned below will give you a better insight on the hourly earnings of employees in the country.

  1. Hourly earnings for all nonfarm employees increased by 7% in July.
  2. The current amount stands at $29.39
  3. Average hourly earnings for nonsupervisory and production employees currently stands at $24.63
  4. The workweek for all nonfarm employees stood at 34.5 hours in the last month.
  5. For manufacturing employees, the workweek stood at 39.7 hours in July.
  6. Production and nonsupervisory employee’s workweek was 34.0 hours last month.

Household Survey Data

Workers Group  Unemployment Rate
Adult Men 9.4 percent
Adult Women 10.5 percent
Teenagers 19.3 percent
White Population 9.2 percent
Black Population 14.6 percent
Asian Population 12.0 percent
Hispanics 12.9 percent

 

What’s surprising in the above data is that the unemployment rate for adult men and the white population is below 10%. However, for all other categories mentioned in this table, the unemployment rate stands above 10%. 

The reason for such a high unemployment rate across all categories is due to several factors. The most prominent reason being that the country’s economy has not yet recovered from the coronavirus pandemic. The other notable reason for the high unemployment rate across all categories is the massive shutdowns of several industries and some businesses slow restarting.  

Other Unemployment Aspects To Consider

Job seekers and the unemployed must understand lots more on the unemployment trends and other critical aspects. The points mentioned below will give you a clear picture of what to expect. 

  1. The number of part-time employees spiked up to 23 million people in July.
  2. People who work part-time due to economic reasons stood at 8.4 million in July.
  3. People who are looking for a job stand at 7.7 million. 
  4. The number of people marginally attached to the workforce stood at 2 million last month.

Conclusion

With a slight revival of the economy, the unemployed should look on the bright side as things are slowly but steadily picking up. Since many sectors have added jobs in these times of uncertainty, the situation looked good in July.  But what’s yet to be seen is if the infection starts spreading in areas already once affected, things could get terrible for the unemployed.  

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