Head of Global Economics
BofA Global Research
Strength in Jobs Numbers
One thing is healing in the U.S. and that’s the job market. While coronavirus infections continue to rise across the nation, we saw 638,000 jobs added to the economy in October, taking the unemployment rate down to 6.9% from 7.9% in September.1
The news is even more encouraging when you just look at the private sector, which added a healthy 906,000 jobs during the month. The drop in state and local government education employment (-159,000) and temporary Census workers (-147,000) dragged on the overall payroll improvement.
Other good news is that job improvement skewed toward the younger cohort. Slicing the data by educational attainment shows us that the lion’s share of job gains were among workers with a high school education or less.
We’ve now seen the U.S. recover 12.1 million jobs lost during the pandemic, reflecting a 54.5% recovery rate. October also saw broad improvement in every major sector of the private labor market, with the exception of utilities.
Yet the number of long-term unemployed (those jobless for 27 weeks or more) rose sharply in October to 3.56 million from 2.41 million. Many of these workers will exhaust their unemployment insurance benefits in coming weeks.
Once the election is behind us the focus will be on the next fiscal stimulus bill and how quickly the two sides can come to an agreement. Senate Majority Leader Mitch McConnell expressed willingness to negotiate on Wednesday, by saying that Congress should approve a relief package before this year’s end. Fingers crossed.
Global Macro Snapshot will return on December 4th.
- U.S. Bureau of Labor Statistics, November 6, 2020
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