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1.4M jobs added last month

1.4M jobs added last month


1.4M jobs added last month

Paul Davidson
USA TODAYPublished 9:38 AM EDT Sep 4, 2020The U.S. economy added 1.4 million jobs in August as businesses shuttered by the COVID-19 pandemic continued to reopen and bring back workers, more than offsetting a fresh wave of layoffs by firms that have exhausted their federal loans.The unemployment rate fell sharply to 8.4% from 10.2% in July, the Labor Department said Friday.Economists surveyed by Bloomberg had estimated that 1.35 million jobs were added last month.August’s payroll gains were healthy but mark the second straight monthly slowdown in hiring after employers added a record 4.8 million positions in June and 1.8 million in July. That’s a troubling sign considering the nation has recouped slightly less than half the unprecedented 22 million jobs wiped out in early spring as states closed down nonessential businesses such as restaurants, malls and movie theaters.“The fact that employment is settling into a trend of slow, grinding improvement is a worrisome sign for the broader recovery,” economist Lydia Boussour of Oxford Economics wrote in a note to clients.The latest figures were inflated by the hiring of 238,000 temporary workers for the 2020 Census who likely will be laid off in coming months. The private sector added 1 million jobs, down substantially from 1.5 million in July. Many states have allowed businesses to reopen in phases but others, especially in the South and West, paused or reversed their relaunch plans in July and August amid coronavirus surges. Recently, cases in those hot-spot states generally have trended down but the results have been mixed. Positive test rates have stayed high in Texas and Florida and edged down just slowly in California, Goldman Sachs says.Long-term pain from COVID-19?: Coronavirus pandemic likely to leave legacy of fear and uncertainty that holds back economy for decadesAs a result, many businesses are running at just partial capacity because of lingering state restrictions and consumer fears of contagion. Many struggling firms recently have exhausted the cash they received through federal loans that were forgivable as long as they retained or rehired workers. After meeting those terms, many are letting workers go again.Last month, the number of Americans on temporary layoff fell by 3 million to 6.1 million as more laid-off workers were called back. At the same time, the number of workers permanently laid off jumped from 2.9 million to 3.4 million, indicating that some temporary layoffs have become permanent.About 45% of unemployed workers said they were on temporary layoff, down from 56% the previous month.”The number of permanent job losses is mounting which is concerning and could result in scarring of the labor market,” says economistRubeela Farouqi of High Frequency Economics.Meanwhile, Congress remains deadlocked over a new stimulus package that would provide more funds for teetering businesses and renew at least part of the $600 federal supplement to state unemployment benefits that expired in late July.”The need for a further stimulus package remains acute,” says economist Ian Shepherdson of Pantheon Macroeconomics.A separate survey released by Cornell University earlier this month showed that 31% of temporarily laid off or furloughed workers who have been rehired,said they were cut a second time and another 26% have been told by their employer that they may be laid off again. Industries that are hiringRetailers led the August payroll gains with 249,000. Professional and business services added 197,000 jobs but more than half came from temporary staffing agencies, indicating that many wary employers are filling openings with contingent workers amid lingering uncertainty.Leisure and hospitality, the sector hardest hit by the pandemic, added 174,000 workers, mostly at bars and restaurants. Transportation added 78,000 jobs and health care, 75,000. Manufacturing, still recovering from a sharp drop in demand and supply disruptions from overseas, added 29,000 jobs.Pandemic alters labor marketAbout 24 million Americans said they couldn’t work last month because their employer closed or lost business during the crisis, down from 31.3 million in July. And about 5.2 million people were prevented from working or looking for jobs because of the outbreak. Nearly a quarter of workers teleworked, down from 26.4% in July..Shifting tastes: Taco Bell removing Mexican Pizza and shredded chicken from menu, adding new Chicken Chipotle Melt

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