Tuesday, September 21, 2021

in-focus

U.S. economy added 916,000 jobs in March, as women reenter workforce and recovery gains steam


WASHINGTON - The U.S. economy added 916,000 jobs in March, as coronavirus vaccine distribution improved, Congress approved a $1.9 trillion stimulus package, and states across the country lifted restrictions on businesses.

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The unemployment rate edged down to 6% last month from 6.2% in February, according to the monthly report from the Bureau of Labor Statistics.

The surge in hiring comes one year after the pandemic threw the U.S. economy into a tailspin, sending a signal that the recovery may have reached a turning point. It followed several sluggish months in the labor market as coronavirus cases surged and many employers paused rehiring amid concerns about efforts to control the pandemic.

Economists hailed the report as a welcome sign that the country may finally be climbing out of the steep hole of jobs lost during the last year, now at a fast enough rate to see a full recovery by some point next year.

"This is a wonderful report. Hopefully we have many more months like it ahead," said Nick Bunker, the economic research director at Indeed, a jobs-listing service. "It's fantastic to see the big bounce back in job gains." At this rate, the labor market could see a full recovery by the middle of 2022, Bunker said.

The labor market lost 22 million jobs in March and April 2020. It recovered 12 million of those jobs over the next six months, but then the pace of rehiring slowed drastically as the virus began a Fall and Winter spike.

The new March data was the largest number of jobs added since August and the third-straight month of growth. The survey was taken the week of March 12th, the same week that the stimulus package passed by Democratic majorities in the House and Senate was signed into law by President Joe Biden.

It could offer clues about the trajectory of the labor market in 2021.

Women, for example, who had left the workforce in droves earlier in the pandemic, are returning to the workforce in large numbers as schools have reopened in-person learning.

But the country is far from in the clear.

Long-term unemployment, those out of work for more than six months, remains a vexing problem as many job-seekers who lost their job early in the pandemic are still out of work a year later. Studies have shown that people out of the labor market for more than six months often have a harder time landing new jobs, a trend that has proven very difficult to address in past recessions. And the personal toll grows too, as time out of work sprawls.

The number of people who have been unemployed for more than six months remains at 4.2 million - up by more than 3.1 million from before the pandemic. A whopping 43% of the unemployed have been out of work for more than six months, the BLS said.

Carter Young, 67, has been out of work since March, after being furloughed, then laid off from his job as a clerk at a resort near Sedona, Arizona. Young said he wishes he could retire, but needs the money to support his family. Even though he's vaccinated, Young said he is still a hesitant to work in another job in retail where he'd have to interact face to face with people, until the virus is brought more under control.

"It's sort of a catch 22," he said. "Things are opening up, and we'll see what happens in the state of Arizona. I'm a little nervous to going out to work with the public."

And the threat of the coronavirus cases rising again also hangs over the economy, said Drew Matus, chief market strategist for MetLife Investment Management. Many of the jobs added in March were driven by companies reopening as pandemic restrictions were lifted, he said.

"People are concerned that some states are reopening too soon," he said. "If states hadn't reopened you probably wouldn't have this number. So we'll see what that means for covid later. It did provide a boost."

In March, 492,000 women reentered the workforce as schools reopened for in-person learning, while 144,000 men left it, bringing the number of men and women who have left the workforce into roughly equal proportions,according to Labor Department data. It reverses the trend from last year, as more women than men left the workforce as the school year began in September.

In addition to women leaving leave their jobs because of schooling and child-care issues, many women were driven out of the workforce because of the disproportionate impact the pandemic had on female-dominated industries.

In February, about 56% of the people who had left the workforce over the last year were women. Now, women represent less than half of those displaced workers. If that trend continues, it could calm concerns that women wouldn't return the workforce, slowing the pace of the economic recovery.

"It's the beginning of the end of the she-cession," said Diane Swonk, chief economist at Grant Thornton. "The minute schools reopened, and jobs were there, they came back."

Still, more women have lost their jobs than men in the last year, Jasmine Tucker, director of research at the National Women's Law Center pointed out.

"There's strides heading in the right direction," she said. "I think once we all get vaccinated and all the schools reopened, there's going to be a surge of more of these folks coming back to the labor force."

Janet Lieb, 62, is feeling more hopeful. The Iowa musician has been supporting herself with unemployment insurance since losing the bulk of her work performing in senior centers at the beginning of the pandemic.

But Lieb said her schedule is finally picking up again. She has performed a couple of times in recent weeks and expects to receive a lot more bookings in April and May.

"These poor folks sitting there, couldn't see their families, had to stay really far apart from each other," she said. "I knew when it did open up, I would be inundated. I started back and a lot of them are having me start in April and May, they're so excited."

President Biden hailed the report, noting that the $1.9 trillion stimulus package he signed into law last month had not fully kicked in. "Opportunity is coming and at long last, there's hope for so many families. Credit for this progress belongs not to me, but the American people."

But the stimulus programs are temporary, and the economy needs a long-term solution for job creation, Biden said, pointing to the more than $2 trillion infrastructure and jobs proposal the White House unveiled earlier this week. "The progress we've worked so hard to achieve can be reversed," he said.

The March jobs report showed gains in industries that have been among the hardest-hit by the pandemic.

The leisure and hospitality sectors added 280,000 jobs last month, as coronavirus restrictions eased around the country. Most of that increase, about 176,000 jobs, came from hiring at restaurants, bars and other food service establishments. Arts, entertainment and recreation facilities gained 64,000 jobs, and hotels gained about 40,000.

The sector still remains about 3 million jobs short of where it was before the pandemic.

Elsewhere, employment rose 126,000 in public education at the state and local level, and 64,000 in private education. Construction added 110,000 jobs after reporting a disappointing decline in February.

Transportation and warehousing added 48,000 jobs, and retail added 23,000 jobs, driven bygrowth in clothing stores, motor vehicle and parts dealers, and furniture and home furnishing stores.

Despite the improvements, minorities, which have also suffered disproportionately during the pandemic, are still lagging behind. The unemployment rate for Blacks was relatively unchanged at 9.6% in March and edged down for Latinos to about 7.9%. For White people, it was 5.4%.

There is much work to be done before the economy returns to its pre-pandemic strength. There are still about 8.5 million fewer jobs now, compared to February 2020, and that doesn't include the growth in the labor market that would have probably occurred over the last year under normal circumstances.

Published : April 03, 2021

By : The Washington Post · Eli Rosenberg