More bad news expected from today’s jobs report
Friday’s employment situation summary is expected to reveal an end to a years-long streak of job additions.
The AP’s Christopher Rugaber reported:
After a record 113 straight months of hiring, the government’s monthly jobs report Friday is expected to show that the American jobs machine came to a sudden halt in March as a result of the coronavirus.
Economists have forecast that the government will say employers shed about 150,000 jobs and that the unemployment rate rose from a half-century low of 3.5% to 3.9%, according to FactSet. But the jobs figure will vastly understate the magnitude of last month’s losses because the government surveyed employers before the heaviest layoffs struck in the past two weeks. Nearly 10 million Americans have since applied for unemployment benefits, far more than for any corresponding period on record.
Still, some job cuts likely happened earlier in the month, when most economists think businesses began clamping down on hiring. The job loss for March will underscore the head-snapping speed with which the economy has unraveled after nearly a decade in which employers added nearly 23 million jobs. As recently as February, employers added 273,000 jobs.
CNN’s Anneken Tappe noted worse may be to come:
The BLS surveys on which the jobs report is based were conducted in the second week in March, when the outbreak’s impact on American businesses and workers was still muted.
Since then, initial claims for unemployment benefits have skyrocketed. Over the past two weeks ended March 28, nearly 10 million people filed for unemployment benefits — 3.3 million Americans in the first week and 6.6 million in the following one. That’s 6% of the American workforce.
Both numbers were historical records at the time they came out. State labor departments are struggling to keep up with the onslaught of workers in need of government assistance.
The March report’s drop in jobs “will likely be dwarfed by job losses closer to 10 million in April, with the unemployment rate rising above 10%,” said economists at Citi in a note.
The April jobs report is due on May 8, and will be a far better measure of the pandemic’s impact on the labor market. Last week, James Bullard, president of the Federal Reserve of St. Louis, said the unemployment rate could soar as high as 30%.
Carmen Reinicke and Andy Kiersz from Business Insider reported:
“We’re really crossing a psychological line in the sand,” Glassdoor economist Daniel Zhao told Business Insider. “If we end that positive streak it’s almost a splash of reality.”
Over the course of March, states across the country ramped up social-distancing guidelines to curb the spread of the disease, banning non-essential business and sending students and workers home.
Still, the March report won’t be a comprehensive picture of the full impact that the coronavirus pandemic has had on the US job market. That’s because the report will include payroll data only through the week ending March 14.