Washington – According to the White House, our Nation’s economy has broken another record as 4.8 million jobs were added in June, bringing the economic comeback to 7.5 million jobs added over the past two months, according to the Bureau of Labor Statistics’ June Employment Situation report.
May and June rank as the two largest monthly jobs gains in history, with June’s numbers exceeding expectations once again. In June, nearly every major employment sector enjoyed a gain in jobs, with the leisure and hospitality industry seeing a gain of 2.1 million and retail trade increasing by 740,000. These gains likely reflect the reopening of State economies from May (based on the work week including May 12) through June (based on the work week including June 12).
Millions of Americans have felt the costs of the economic shutdown due to COVID-19, and while the speed of this recovery has far exceeded expectations, jobs have still not recovered the ground lost since the economic shutdown began. From February to April, nearly 22.2 million total jobs were lost. Over the past two months, 7.5 million (33.8 percent) of those jobs have returned. Figure 1 shows that while the leisure and hospitality industry saw the largest gains over the past two months, the industry still has 4.8 million jobs to make up to reach its pre-COVID level.
Additionally, the BLS June Employment Situation report estimates that the overall unemployment rate fell by a record 2.2 percentage points in June to 11.1 percent, and by 3.6 percentage points over the past two months.
Even the 3.6 percentage point reduction in the official unemployment rate since April likely understates the actual progress made. As BLS Commissioner William Beach recently explained, the unique circumstances COVID-19 caused has led the household employment survey to misclassify some workers as “employed” who should have been classified as “unemployed” due to temporary business closures. As the Council of Economic Advisers (CEA) has previously noted in our May 8th blog, addressing this issue could have resulted in an unemployment rate upward of 19 percent in April. When accounting for this misclassification, CEA finds that the unemployment rate of 19.6 percent in April has fallen to 12.3 percent as of June (see figure 2). This 7.2 percentage point reduction is twice as large as the 3.6 percentage point reduction in the official unemployment rate over the same period.
The economic comeback has reduced unemployment across the board for several demographic groups. According to the BLS, the unemployment rate fell by 3.1 percentage points for Hispanic Americans and by 1.4 percentage points for Black Americans. In fact, Black Americans enjoyed the second largest employment gain on record, and female Black Americans over age 20 experienced the largest employment gain on record. Additionally, the female unemployment rate fell by 2.7 percentage points, which is larger than the decrease for men for the second straight month. As America’s businesses have reopened, teenagers saw a 6.7 percentage point unemployment rate reduction last month, consistent with the large job gains in the leisure and hospitality and retail trade industries.
While June’s jobs report is undoubtedly positive news for our Nation, millions of Americans continue to suffer due to the COVID-19 pandemic. An increasing number of long-term unemployed workers remain, low-wage earners still make up a smaller portion of the labor force, and more than one in every ten workers remains unemployed. The successes in the jobs report, however, should provide a source of optimism for all Americans as we look toward the future.
For two consecutive months, we have experienced the largest job gains in history, and the resilience of the American people remains strong as we have recovered roughly one-third of the COVID-related job losses from March and April. As we look ahead, we should be mindful of the work that remains, so that the forgotten Americans are forgotten no more.
Source: White House