4.8 million jobs added in June

4.8 million jobs added in June

  • Post published:July 2, 2020
  • Post category:News

The June Jobs report exceeded expectations yet again, 4.8 million jobs were added to the U.S. economy and unemployment dropped from 13.3% to 11.1%. This record Jobs Day report crushed forecaster’s expectations by 1.7 million jobs and is the largest increase since the series began in 1939.

June Employment Situation Report

Employment Smashes Expectations Once Again

  • The U.S. economy added 4.8 million jobs in June, and the unemployment rate fell from 13.3 percent to 11.1 percent.
    • Employment increased significantly in leisure and hospitality (2.1 million), retail trade (740,000), education and health services (568,000), other services (357,000), and manufacturing (356,000).
  • The median of all private forecasters predicted 3.1 million job gains in June and an unemployment rate of 12.5 percent.
    • The economy beat expectations yet again by 1.7 million jobs (more than the population of Hawaii) and the unemployment rate fell 1.4 percentage points more than expected.
  • June’s 4.8 million job gain is the largest monthly gain on record, and together with the 2.7 million jobs added in May, represent a recovery of roughly one-third of the COVID job losses in March and April.

Workers Are Back at Work and Reentering the Labor Force

  • The number of unemployed reentrants to the labor force rose by 43 percent (+711,000) in June, showing increasing worker confidence in finding a new job.
  • June’s labor market flows show fewer workers dropping out of the labor force.
    • Flows from employment to not in the labor force were 3.6 million from May to June, below the average over the 12 months before this March (4.7 million).
  • We estimate that there were 12.5 million people temporarily laid off in June (including the temporary job losses likely mistakenly classified by BLS as employed but not at work for other reasons), a decrease of 7.7 million since May.
    • Including potentially misclassified workers such as those on temporary layoff, 63.5 percent of unemployed persons in June were on temporary layoff, and 84.3 percent of the increase in unemployment since February is due to temporary job loss.
    • If you additionally include persons who have left the labor force but want a job, 68.3 percent of the increase in unemployment since February is due to temporary job loss.

Historically Disadvantaged Groups Share in the Recovery

  • The unemployment rate for Hispanic Americans plummeted 3.1 percentage points, the unemployment rate for women fell 2.8 percentage points, and the unemployment rate for Black Americans dropped 1.4 percentage points.
  • The number of employed Black Americans increased 404,000, the second highest gain on record, with the largest gain recorded occurring just 2 months after President Trump signed the Tax Cuts and Jobs Act into law.
    • The number of employed adult female Black Americans (age 20+) recorded the largest gain on record in June, increasing by 267,000.
  • The unemployment rate for Americans age 25 or older with less than a high school education and the rate for those with only a high school education dropped 3.3 percentage points and 3.2 percentage points, respectively.
    • These rates fell more than the overall unemployment rate for Americans over age 25 (-1.9 percentage points).

Long-Term Unemployment is Increasing

  • Low-wage workers still make up a smaller portion of the labor force, leading wages to rise 5.0 percent over the year.
    • In a sign low-wage workers are returning to the labor force, nominal average hourly earnings for all private sector workers in June fell 1.2 percent over the month.
  • The number of long-term unemployed workers is increasing.
    • The number of workers who have been unemployed for 15 to 26 weeks increased by 76.5 percent (+825,000), and the number of workers who have been unemployed for 27 weeks or more increased by 19.5 percent (+227,000).