The unemployment rate jumped to 14.7 percent in April and the economy shed 20.5 million jobs, according to data released by the Department of Labor on Friday.
April was the second consecutive month of job losses for the U.S. economy following the record 113 months run of expanding employment rolls.
Economists had forecast that the economy would lose 21 million jobs and that the unemployment rate would climb from 4.4 percent to 16 percent. So the April figures were better than expected.
March’s job losses were revised up from a loss of 701,000 to 870,000. February, which saw job gains, was revised down by 45,000 from 275,000 to 230,000, a reminder of how just how strong the jobs market was prior to the onset of the coronavirus crisis.
Employment fell sharply in all major industry sectors, with particularly heavy job losses in leisure and hospitality, the Labor Department said. Both average hourly earnings and average hours worked moved up in April, likely reflecting businesses shedding newer and lower-paid employees first and attempting to make do with smaller payrolls by increasing hours.
Manufacturing shed 1.3 million jobs, including 381,500 in the auto sector. Construction lost 975,000 jobs. Health care and social assistance shrank by more than 2 million jobs.
White-collar positions have not been immune to the coronavirus jobs catastrophe. Information technology and financial services sectors shrank by more than one-quarter of a million jobs. Business services lost 2.1 million jobs.
The scale of the job loss has been breathtakingly sudden despite an unprecedented level of support for the economy from the federal government and the Federal Reserve. Over the past seven weeks, more than 33 million Americans have filed claims for unemployment benefits. But the number of claims has been declining for five consecutive weeks.
The Trump administration successfully pushed Congress to authorize direct payments to U.S. households to support incomes and to raise the amount paid by unemployment benefits by $600 a week, making it possible for some Americans to earn more through losing a job than they made working. The federal government is also backing over $600 billion of loans to small businesses that can be forgiven if those businesses avoid layoffs.
The Fed cuts its interest rate target to a range between 0 and 0.25 percent. In addition, it is in the process of launching a number of new lending facilities aimed at providing liquidity to struggling businesses.
But loans and direct payments can only go so far to offset orders that many businesses close their doors entirely or dramatically reduce the number of customers they serve. The customers were told to stay at home and avoid going out except to...
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1 comment:
Well my wife just got called back to work, thank God, she was driving me nuts.
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