FEBRUARY 8, 2021 – UNEMPLOYMENT RATE FALLS AS THE US ADDS A PALTRY 49,000 JOBS
The US Labor Department announced Friday, the US added 49,000 jobs in January while the unemployment rate fell to 6.3 percent. Economists were expecting greater job growth, ranging from 50,000 from Dow Jones to 250,000 from Citigroup. In December, the economy lost jobs, so positive job growth is welcome, but adding only 49,000 is not very encouraging.
The unemployment rate was down due to 406,000 people left the workforce. Approximately 10 million Americans are still unemployed, 4.3 million more than a year ago. Many businesses, mainly in the entertainment industry, are still under lock-down or functioning at a reduced capacity due to the virus. The hospitality sector lost 536,000 jobs in December and another 61,000 last month.
As the vaccine roll-out picks up speed, many are hopeful the US economy will return to ‘normal’ in the second half of the year; but the outlook for the first quarter of 2021 is uncertain. President Biden is trying to push through a $1.9 trillion rescue package which includes direct payments to individuals and enhanced unemployment benefits.