U.S. unemployment rate falls to 8.4% even as hiring slows
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The U.S. unemployment rate fell sharply in August to 8.4% from 10.2%, even as hiring slowed in August as employers added the fewest jobs since the pandemic began. Employers added 1.4 million jobs, the Labor Department said Friday, down from 1.7 million in July.
The U.S. economy has recovered about half the 22 million jobs lost to the pandemic.
Julia Coronado, president and founder of MacroPolicy Perspectives, spoke with “Marketplace Morning Report” host David Brancaccio. The following is an edited transcript of their conversation.
David Brancaccio: So you spotted right away who was doing a lot of the hiring. The answer is?
Julia Coronado: The census. So we were expecting the census to add a lot of jobs. These are temporary census data collectors. They added more than 200,000 jobs. If we look, excluding census, at the private sector hiring that was about a million jobs. That’s down from 1.5 million in July. So a little bit of loss of momentum and hiring.
Brancaccio: A little bit of a loss of momentum. And it looks like a lot of people who were on temporary furlough, but still tenuously connected to their old jobs, actually got their jobs back.
Coronado: Yes, that is still the story here. Lots of reconnections. The retail sector, for example, added 250,000 workers. So there is still lots of reconnections going on. And, in the coming months, what we’re going to be looking for is whether there are more permanent layoffs underway. We’re seeing lots of company announcements along those lines.
Brancaccio: What accounts for the unemployment rate falling to a lower-than-expected 8.4%?
Coronado: Good hiring numbers are driving the unemployment rate lower. It was a little bit more than expected. What we’re not seeing is people leaving the labor force, which could actually push the unemployment rate lower. The participation rate actually rose a little bit in August.
With reporting from The Associated Press
COVID-19 Economy FAQs
With a slow vaccine rollout so far, how has the government changed its approach?
On Tuesday, Jan. 12, Health and Human Services Secretary Alex Azar announced changes to how the federal government is distributing vaccine doses. The CDC has expanded coronavirus vaccine eligibility to everyone 65 and older, along with people with conditions that might raise their risks of complications from COVID-19. The new approach also looks to reward those states that are the most efficient by giving them more doses, but critics say that won’t address underlying problems some states are having with vaccine rollout.
What kind of help can small businesses get right now?
A new round of Paycheck Protection Program loans recently became available for pandemic-ravaged businesses. These loans don’t have to be paid back if rules are met. Right now, loans are open for first-time applicants. And the application has to go through community banking organizations — no big banks, for now, at least. This rollout is designed to help business owners who couldn’t get a PPP loan before.
What does the hiring situation in the U.S. look like as we enter the new year?
New data on job openings and postings provide a glimpse of what to expect in the job market in the coming weeks and months. This time of year typically sees a spike in hiring and job-search activity, says Jill Chapman with Insperity, a recruiting services firm. But that kind of optimistic planning for the future isn’t really the vibe these days. Job postings have been lagging on the job search site Indeed. Listings were down about 11% in December compared to a year earlier.
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