On Friday, the Bureau of Labor Statistics (BLS) will release its latest jobs report on the state of the labor market for January 2021. The pandemic recession has caused immense damage to the health and economic well-being of millions of people for over 10 months. The economic pain easily extends to nearly 27 million workers in the economy today, and that doesn’t include those who had lost their jobs and regained employment but got behind on their bills or those who lost loved ones and providers to illness. It is imperative that policymakers act now at the scale of the problem.
Now that the economic losses have dragged on for this long, it’s important to consider the job deficit in light of an appropriate counterfactual. The employment losses in March and April totaled 22.2 million, while the economy gained 12.5 million jobs between May and November. In the figure below, note the significant slow down in job growth in each successive month since June. Then, in December, the U.S. economy experienced a loss of 140,000 jobs. Given low actual seasonal hiring in the pandemic, seasonal adjustments made the December numbers look worse than they really were and will make the January numbers look better than they were. The average job change in December and January will provide a better sense of current labor market momentum. Setting that issue aside, it’s clear that the labor market was down 9.8 million jobs between February and December.
On Friday, the BLS will also publish the latest benchmark revisions to the Current Employment Statistics, which pegs payroll employment to comprehensive counts of state unemployment insurance records. The preliminary benchmark revisions indicated that there were 173,000 fewer jobs in March 2020 than originally reported. Once those revisions are factored in, the labor market in December is 9.9 million jobs short of its February level. (Be warned, rounding is doing a lot of work here: the change is from 9.839 million to 9.853.)
Chosen excerpts by Job Market Monitor. Read the whole story @ What to watch on jobs day: The giant job deficit left by the pandemic | Economic Policy Institute