As employers cut back their hiring plans amid the spread of the Delta variant of COVID-19, in a sharp drop from preceding months the US economy added just 235,000 jobs in August, The Guardian reports.
The unemployment rate declined by 0.2 percentage points to 5.2 per cent from 5.4 per cent in July and has fallen dramatically from its high of 14.7 per cent in April 2020. According to the Bureau of Labor Statistics, monthly US job growth has averaged 586,000 so far this year.
However, the hiring slowdown in August was unexpected. Economists polled by Bloomberg had anticipated a gain of 725,000 jobs for August, after surging over 1m in July.
In a White House address, President Joe Biden largely glossed over the disappointing figures, he described the US economy as “durable and strong” and claimed his administration had added double the number of jobs of any prior first-year president.
President Biden said, “While I know people wanted to see a larger number today, and so did I, what we’ve seen this year is continued growth month after month in job creation.
“Wages are going up. This is the kind of growth that makes our economy stronger, and not just boom or bust.”
According to the latest government figures, job increases in August came from gains in professional and business services, transportation and warehousing, private education and manufacturing.
But employment in retail reportedly dropped over the month as employers failed to add workers in lower-wage industries such as transportation, leisure and hospitality in response to weakening demand for those services. The lack of demand is itself a reflection of the effect that the Delta variant is having on consumer activity.
About 5.6 million people did not work at all or worked fewer hours at some point in August as a result of the pandemic, an increase of 400,000 from July.
Paul Ashworth - chief US economist at Capital Economics said, “The drop-off in high contact services employment growth suggests that, even though few states have reimposed restrictions beyond mask mandates, the Delta variant is nevertheless weighing on activity by scaring off customers.”
Source: The Guardian
(Quotes via original reporting)
As employers cut back their hiring plans amid the spread of the Delta variant of COVID-19, in a sharp drop from preceding months the US economy added just 235,000 jobs in August, The Guardian reports.
The unemployment rate declined by 0.2 percentage points to 5.2 per cent from 5.4 per cent in July and has fallen dramatically from its high of 14.7 per cent in April 2020. According to the Bureau of Labor Statistics, monthly US job growth has averaged 586,000 so far this year.
However, the hiring slowdown in August was unexpected. Economists polled by Bloomberg had anticipated a gain of 725,000 jobs for August, after surging over 1m in July.
In a White House address, President Joe Biden largely glossed over the disappointing figures, he described the US economy as “durable and strong” and claimed his administration had added double the number of jobs of any prior first-year president.
President Biden said, “While I know people wanted to see a larger number today, and so did I, what we’ve seen this year is continued growth month after month in job creation.
“Wages are going up. This is the kind of growth that makes our economy stronger, and not just boom or bust.”
According to the latest government figures, job increases in August came from gains in professional and business services, transportation and warehousing, private education and manufacturing.
But employment in retail reportedly dropped over the month as employers failed to add workers in lower-wage industries such as transportation, leisure and hospitality in response to weakening demand for those services. The lack of demand is itself a reflection of the effect that the Delta variant is having on consumer activity.
About 5.6 million people did not work at all or worked fewer hours at some point in August as a result of the pandemic, an increase of 400,000 from July.
Paul Ashworth - chief US economist at Capital Economics said, “The drop-off in high contact services employment growth suggests that, even though few states have reimposed restrictions beyond mask mandates, the Delta variant is nevertheless weighing on activity by scaring off customers.”
Source: The Guardian
(Quotes via original reporting)