While the nation is steadfastly watching and waiting for the results of the presidential election, labor economists and market watchers took a beat to examine the new data on the economy that was released this morning from the Bureau of Labor Statistics. We learned that the unemployment rate dropped further, by one percentage point to 6.9 percent, as the economy added more than half a million jobs (+638,000). This beat expectations from earlier in the week, and also exceeds what many had been predicting for the trajectory of the recovery just a few months ago.
This is very welcome news, as it indicates continued expansion despite rapidly growing case counts in the Covid-19 pandemic and the possibility of further shutdowns being needed in the coming months. However, the level of employment still remains significantly below where we were in February, before the pandemic began to affect our economy. To return to that level, we’ll still need another 10 million jobs. At the current pace, we won’t see that happen for several months.
As we’ve been saying for months now, the trajectory of the US economy will depend critically on the trajectory of the pandemic in coming months. The slowdown in growth that we’ve been seeing is worrisome given that the winter months are expected to bring a worsening of Covid-19 transmission and the potential for further limitations on economic activity.
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