Job growth slowed sharply in November, weighed down by COVID-19
Hiring around the U.S. slowed sharply last month as the coronavirus battered the economy, the Labor Department said Friday. Employers added 245,000 jobs in November — the slowest pace of monthly job growth since April, and about half what economists had expected.
Payroll gains last month amount a sharp drop from the 610,000 jobs added in October and 710,000 in September. The nation's unemployment rate, which has steadily declined since peaking at nearly 15% in April, ticked down to 6.7%. But it fell for a bad reason — 400,000 people stopped looking for work, meaning they were no longer counted as unemployed.
Normally, adding nearly a quarter million jobs in a single month would signify healthy growth, but the economy faces a massive jobs deficit, with about 10 million fewer jobs since April. Since then, 4 million people have dropped out of the workforce altogether, meaning they are not working or looking for work.
"With the amount of pressure that the escalating pandemic is putting on the labor market right now, it's pretty clear that a double-dip recession is a very real possibility," Steve Rick, chief economist at CUNA Mutual Group, said in a note. "For those who have been out of a job since March or early Spring, this extended period of unemployment will make it even more difficult to find new, stable work."
"[T]he bottom line is that job growth has slowed markedly, and this report demonstrates yet again that it's not possible to separate the economy from the virus," Ian Shepherdson, chief economist at Pantheon Macroeconomics, said in a note to investors.
Manufacturing and construction each added 27,000 jobs last month. The retail sector lost 34,000 jobs, offset by a gain of 145,000 jobs in transportation and warehousing, driven by a shift to ecommerce.
Signs that the surge in coronavirus cases is hurting the recovery raises pressure on lawmakers in Washington, D.C., to agree on a new round of emergency spending. Congressional leaders are discussing a bipartisan $908 billion package that would extend unemployment benefits, offer loans to small businesses, and provide funding to cash-strapped states and localities.
Without such a deal, benefits for 12 million Americans are set to expire on December 26.