The United States economy rebounded a little more last month, as the Labor Department’s jobs report revealed that 4.8 million jobs were added in June — the biggest month over month increase on record.
The unemployment rate fell to 11.1%, down from a peak of 14.7% in April, but still higher than in any previous period since World War II. The Labor Department noted in May’s jobs report that millions of workers were misclassified during the pandemic as “employed but not at work,” when they should have been counted as “unemployed on temporary layoff.” If it weren't for those misclassifications, the unemployment rate would have been higher — around 19.2% in April and 16.1% in May, not including seasonal adjustments.
May's figure was also revised up by 130,000, which means 2.7 million jobs were added last month. Still, the nation's jobless rate is up 7.6 percentage points compared to the start of the year, when it sat at a half-century low. There are 12 million more out-of-work Americans than compared to February.
Economists surveyed by Refinitiv expected the report to show that unemployment dropped to 12.3% and that employers added 3 million jobs.
It’s important to note that the jobs report was compiled in mid-June, before coronavirus cases began to spike in Arizona, Florida and several other states. The Labor Department also released data that revealed 1.4 million Americans filed new claims for state unemployment benefits last week, and more than 800,000 filed for benefits under the federal Pandemic Unemployment Assistance program.
“Today’s jobs report is a look in the rearview mirror,” Andrew Chamberlain, chief economist at Glassdoor, told FOX Business. “With surging COVID-19 cases hitting new highs in the past week, rough waters are surely ahead for the economy in the coming months as a second wave could again shutter millions of American small businesses and put a freeze on hiring.”
The report showed that the number of adults who are working part-time hours for economic reasons remained elevated at 9.1 million in June, more than double its February level. The figure dropped by 1.6 million between May and June, as a sizable chunk of people who prefer full-time work found it, the Labor Department said.
The remaining group of involuntary part-time workers provides a clearer image of remaining challenges of a pandemic-era labor market. While overall joblessness is improving, a broader rate that counts underemployed workers and those who would like a job but are not actively looking is also healing, but is still at a historically high 18%.
About the Author
Brett Christie is the managing editor of Workspan Daily.