JULY 6, 2020 – JOB NUMBERS RISE IN JUNE, BUT SOME BACKTRACKING IS EXPECTED
The US economy created jobs at a record pace in June as more restaurants and bars resumed operations after being shuttered for months. Nonfarm payrolls increased by 4.8 million in June, the Labor Department reported Thursday. This was the greatest increase since the government started keeping records in 1939. Payrolls had rebounded by 2.7 million in May.
Economists polled had forecasted payroll increases of 3 million jobs in June. Despite the record setting gains, the US economy has yet to replace even half of the record 20 million jobs lost in April.
Jerome Powell this week acknowledged the rebound in activity, saying the “economy had entered an important new phase and (had) done so sooner than expected.” But he cautioned the outlook “is extraordinarily uncertain” and would depend on “our success in containing the virus.”
Unfortunately, several states have started scaling back or pausing re-openings since late June, and sent workers home due to a resurgence of Covid cases in certain states. The impact of these closures is not reflected in the June data, as data was collected mid-month.
The unemployment rate fell to 11.1% in June from 13.3% in May, largely due to companies rehiring furloughed workers when non-essential businesses re-opened.