More people found work last month, but there are doubts about whether the growth can be sustained.
The US job market extended its recovery in July despite the spread of coronavirus cases around the country.
That’s the first ― and biggest ― takeaway from the monthly employment report released Friday by the Bureau of Labor Statistics. Employers added 1.8 million jobs last month and the unemployment rate fell to 10.2 percent from 11.1 percent — exceeding analysts’ forecasts for both measures.
“We have seen a very troubling increase in COVID-19 cases in many states that had reopened for business, but we continue to be cautiously optimistic that the overall US economy has turned a corner, and that the solid job gains announced today will be sustained,” Tony Bedikian, head of global markets at Citizens Bank in Boston, said in an e-mail statement.
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After the devastating loss of 22 million jobs in March and April, the economy added back more than 9 million positions in the past three months. Under normal circumstances, that would be a blowout performance, but things are anything but normal.
Here’s a quick rundown of other important takeaways from the report.
The good news has to be viewed within the context of an economy that is stuck in a deep hole and whose way out hinges on whether the country can get the pandemic under control. More than 16 million people remained unemployed in July, and another 8 million were working part-time hours when they want to be full time. Even after declining by 0.9 percentage point, the jobless rate is higher than it was at any time during or after the Great Recession in 2007-2009.
The pace of job growth is slowing. Employers added 4.8 million jobs in June and 2.7 million in May. In part, this reflects a natural easing of hiring after a big burst when states first began to reopen. But it also reflects the impact of the more recent spike in infections and the deep uncertainty among employers who are struggling with revenue significantly below pre-pandemic levels.
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There is a lot of churn in the job market. The number of workers on temporary layoff fell by 1.3 million in July to 9.2 million. But the number of people who permanently lost their paycheck barely budged at 2.9 million. The number of people who jumped back into the job market but had yet to find employment was also unchanged at 2.4 million.
Layoffs continue apace. The number of people recently put out of work — those jobless less than 5 weeks — increased by 364,000 to 3.2 million in July. During the month 5.5 million new jobless claims were filed nationally, according to a BLS report on Thursday.
It can take a while to get rehired or find a new job. The number of people without a job for 15 to 26 weeks rose by 4.6 million to 6.5 million, and those who had been unemployed for more than 27 weeks was little changed at 1.5 million. The sweet spot for getting back to work seems to be within 5 to 14 weeks, where the number of people without a job fell by 6.3 million to 5.2 million. The number of long-term unemployed (those jobless for 27 weeks or more) was little changed at 1.5 million over the month.
Employers are hedging their bets by adding part-time jobs. In July, the number of people who typically work part time rose by 803,000 to 24 million, while the number who usually work full time was flat at 119.5 million.
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The bottom line: While the job market continued to improve, unemployment remained at painfully high levels last month. There is no reason why Congress and the White House should not immediately restore enhanced jobless benefits — the $600 a week that recently expired — to help millions of Americans buy food and pay the rent, mortgages, and utilities. The unemployment crisis is far from over.
Larry Edelman can be reached at larry.edelman@globe.com. Follow him on Twitter @GlobeNewsEd.
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