U.S. Unemployment Rate Fell to 8.4% in August as Hiring ContinuedSeptember 4, 2020 Off By administrator
Unemployment fell sharply in August and hiring gains moderated, as the U.S. economy continued to recover from the steep downturn triggered by the coronavirus pandemic.
The U.S. economy added 1.4 million jobs last month, helping push down the unemployment rate to 8.4% from 10.2% in July, Friday’s Labor Department report said. The jobless rate’s decline—it has dropped from near 15% in April at the beginning of the pandemic—put it below the peak from the 2007-2009 recession.
That puts unemployment in line with past major recessions, though it is significantly higher than pre-pandemic levels. The jobless rate stood at 3.5% in February, a half-century low, just ahead of the coronavirus crisis.
State reopenings of their economies helped boost employment this summer, but the gains have cooled in recent months. The economy is operating with about 11.5 million fewer jobs than in February.
“The jobs market is clearly out of the ditch and still firmly on the road to recovery, but slowing,” Jim Baird, Plante Moran Financial Advisors’ chief investment officer, said in a note to clients.
The number of unemployed individuals saying their layoffs were temporary declined to 6.2 million in August from 9.2 million in July, indicating many employers are bringing back workers. But the number of individuals saying their layoffs were permanent rose to 3.4 million last month, a shift from earlier in the pandemic when more people thought their jobs would return.
Retail and government hiring helped drive August’s jobs gains. Super centers and home improvement stores have seen employment increase during the pandemic, and other types of retailers, including department and furniture stores are seeing a rebound after a deep decline. Meanwhile, Census hiring boosted federal jobs, while state and local employment has held up relatively well as the school year gets under way.
Financial markets were mixed. U.S. Treasury yields rose after the better-than-expected jobs news, while stocks continued a selloff driven by declines in technology companies.
The economy continues to face uncertainty, with the total number of coronavirus cases in the U.S. exceeding 6.15 million and warnings from some governors about persistent risks from the virus.
Several large companies have warned of job cuts in recent days, a sign the labor market could face an uneven performance this fall.
United Airlines Holdings Inc.
said Wednesday it plans to cut 16,370 staff amid a pandemic-driven slump in passenger demand.
said last week it plans to lay off some employees.
Economists say new company layoffs reflect a shift in employers’ mentality from earlier in the crisis, when many expected shutdowns would be over in a matter of weeks.
“If you are laying people off now, you kind of know that this…