ThinkWhy, a SaaS company helping businesses navigate the labor market, has released its U.S. monthly jobs report for July 2020. According to the Bureau of Labor Statistics (BLS), the U.S. economy gained 1.8 million jobs in July, a 63% decrease from June’s record number. Despite the sequential moderation, July 2020 still registered as the third largest month of job gain in U.S. history behind the back-to-back record-setting months of May (2.7 million) and June (4.8 million) this year.
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“The rise in COVID-19 numbers slowed the pace of economic rebound. Meanwhile, the pace of job gains have moderated and July’s job gain would be considered beyond robust in normal times, but it signals that the strength of recovery is highly dependent on our ability to contain the virus.
The nation still has almost 13 million jobs to recoup from the early stages of the pandemic. As reported by the Census Bureau’s weekly household pulse survey, a stall in momentum began in late June as COVID-19 infection rates rose and impacted the pace of the recovery. Considering one-third of the jobs that remain open are in the leisure and hospitality industry, a sector that heavily relies on close proximity to people. Until the virus is under control, a more pronounced rebound will be difficult.
“The rise in COVID-19 numbers slowed the pace of economic rebound. Meanwhile, the pace of job gains have moderated and July’s job gain would be considered beyond robust in normal times, but it signals that the strength of recovery is highly dependent on our ability to contain the virus,” said Jay Denton, SVP, Business Intelligence and Chief Innovation Officer at ThinkWhy.
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Labor Market Performance:
- Unemployment sits at 10.2%
- Temporary layoff level is 9.2 million
- July’s job gains concentrated in industries such as Leisure and Hospitality (592,000) and Government (301,000)
- In addition, total nonfarm payroll average hourly earnings increased by 0.2% year-over-year ending in July 2020
The U.S. economy has now gained more than 9.3 million jobs in the past three months. The question remains whether the economy can continue to gain significant traction. The most recent unemployment insurance claims report from August 6 shows signs of that a lull was occurring in the speed with which jobs were being refilled, as the trend line for claims was flattening. Then initial unemployment insurance claims fell below 1.2 million for the week ending August 1. It was the lowest weekly total for initial claims since the spike in March, and continued claims for the week ending July 25 dropped by 844,000 from the week before.
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