The Labor Market lost far more than 140,000 jobs in December

The number of monthly jobs is a slippery statistic, as I wrote later. The December 2020 report is almost as misleading as it is based on the “official” stats.

Friday’s news showed that job losses have been largely without a reduction in unemployment, as the first paragraph of the report shows:

Total nonfarm payroll earnings fell 140,000 in December, and the unemployment rate remained unchanged at 6.7 percent, the U.S. Bureau of Labor Statistics said today. The decline in wage earnings reflects the recent rise in coronavirus (COVID-19) cases and efforts to contain the pandemic. In December, job losses in leisure and hospitality and in private education were partially offset by gains in professional and business services, retail trade, and construction.

The statement may not look so bad if taken without context. People were clearly scrambling up on Thanksgiving Day, setting up a new wave of virus spread that would cost a lot of progress in upsetting the situation. And the same thing may have happened during the holidays at the end of the year, meaning we can expect another round to start any day now.

The numbers are net. Entertainment and hospitality lost 498,000 jobs, with 372,000 of those in restaurants and bars. Gambling industry earnings are 92,000.

Private education employment has fallen by 63,000, leaving 450,000 in February last year.

Some of these huge losses were offset by benefits, such as in sales (employees up for the holidays), professional and business services (keep those Zoom calls going), construction (how people looking to expand their homes or buy new ones so that everyone in the family can work or study at home), and health care (for some obvious reasons).

But change is more dangerous here than it seems obvious. One reason is that the number of people is no longer counted as unemployed. The official statistics, known as U-3, do not include people who are “slightly connected” or who were “employed part-time for economic reasons. ”

The explanations are important. Marginal connection means that someone was either working or looking for work in the last 12 months but was not over the previous four when they were interviewed. The government’s definition of looking does not include going through work lists; the person must apply for a specific job. It also avoids those who were ill, caring for a family member, inability to get the necessary transportation, or some other reason.

People who work part-time for economic reasons want full-time employment, but can’t find it because of the current business conditions.

The U-6 rating, also provided by the government, states that unemployment is at 11.7%. Here’s where that comes from:

The number of people with little contact with the workforce rose by 2.2 million, almost double the 1.2 million a year earlier. In December 2019, 4.2 million were employed part-time for economic reasons. Prior to last month, the figure was 6.2 million.

At least 3 million people have left the labor market as far as government figures can tell. That doesn’t count the 4.6 million people who couldn’t find work because of the pandemic.

Compared to the previous year, there were 5 million more people in the workforce, and nearly 9 million fewer were employed. Another way of doing that is to put around 9 million more people out of work than was the case a year ago. Enter the 5 million that are no longer counted and that’s about 14 million.

What are the numbers in the “true” measure? No one knows, but these inequalities look at the fact that many more people are out of work and that the economy is far worse than it should be, even though there are some who in the stock market.

Breaking down by gender, nearly 4.5 million fewer women 20 years and older are employed than the same time in 2019. The fallout for men was around 1.4 million.

And, just back to the pandemic, 15.8 million people said they could not work at all or worked fewer hours over the previous four weeks because the employer closed or that they lost business because of the virus.

Oh, and over a third (37.1%) of the total number unemployed in December have been out of work for 27 weeks.

This is a picture of a labor system in great trouble, even though many paint this as a slow recovery. In context, it is a cure for some and not for many others. Because of the consumer-led nature of the U.S. economy, the country had better figured out how to get more people back to work and spend.

For millions, that $ 600 review has already come and gone.