According to the Labor Department data, the U.S. generated 4.8 million jobs in June as the unemployment rate dropped to 5.7% from 5.8% in May. In addition, April and May data yield an additional 90,000 jobs to the previous estimate.
Unemployment Rate Falls As The U.S. Adds 4.8 Millions Jobs in June
As informed by Reuters, more than 150 million people are fully immunized, allowing for the lifting of pandemic-related restrictions. In May, new jobs within categories such as leisure and hospitality increased considerably as they did in retail, education and health services, manufacturing, and professional and commercial services.
Despite the employment rate increasing by 0.7% in June to 61.5%, this is still 1.9% below February levels. Further, the number of people who generally work full-time increased by 2.4 million to 118.9 million, while part-time workers increased by around 2.4 million to a 23.2 million total –average hourly wage fell 35 cents to $29.37.
The leisure and hospitality sectors contributed with 2.1 million jobs, which represent close to 40% of the total growth. The retail sector hired 740,000 people while the manufacturing sector added 356,000 jobs.
The reopening of routine medical appointments has helped employment within health care and health services increase by 568,000 jobs, while barely 7.5 million of the 22 million jobs lost since March have been recovered.
Another key factor to the lowered unemployment rate was the drop in temporary layoffs, which fell by 4.8 million in June to 10.6 million.
COVID-19 Cases Bounce Back Up
However, the Bureau of Labor Statistics (BLS) recognized that a possible “misclassification” still continues to distort the result of the survey, and without it, the unemployment rate would have been 1% higher on a non-seasonally adjusted basis.
For Michael Pearce, economist at Capital Economics, the biggest factor behind the rebound in employment has been the continuing trend toward reopening, which is now reversing in some states.
Precisely, this data comes at a time when the rebound in infections threatens to cloud the reopening processes in multiple states, as the number of daily cases reached a new record this week, exceeding 50,000. All eyes are on Arizona, California, Texas, and Florida, which have either frozen or reversed their de-escalation plans.
Florida, Michigan, Arizona, and Texas have shut down indoor service in bars while California has closed bars and restaurants in 19 counties which represent more than 70% of the population. New York and New Jersey have delayed plans to reopen interior service at these types of establishments.