Employment conditions in the US continued improving through November to close out the fall season of 2020, but the rate of recovery has continued slowing down, as well.
Part-time employee unemployment spiked to 24.5% percent when the pandemic hit in April with full-time unemployment “only” rising to 12.5%. The part-time unemployment rate is now below full-time, meaning that bubble is gone, we have settled in and there will be few, if any, more dramatic shifts downward in the unemployment rates.
In November, total unemployment dropped to 6.7% - down .2% from the 6.9% unemployment rate clocked one month earlier in October. This .2% reduction in unemployment is 5 times slower than the 1% change measured from September to October, and slower still than the 1.36% average monthly reduction in unemployment that occurred between September and the peak of 14.7% unemployment that occurred last April.
In short, the unemployment figures are still improving, but that rate of improvement is levelling off and we are still 3.2% above the unemployment figures from February 2020 prior to the pandemic’s effects on the US economy and job/labor markets taking hold.
Similarly, non-farm payroll figures continued to improve through November with the addition of 245,000 new jobs, but that increase is less than half of the number of jobs added in either September or October (661k and 638k, respectively), which in turn were less than half of the job additions that were accounted for in July and August (1.8 and 1.4 million, respectively).
The recovery in this regard clearly appears to be slowing down as well. With total job numbers in this category still down 6.5% (almost 10 million jobs) from last February, there is still much ground to make up in order to return to pre-pandemic levels of employment.
Despite consistent job gains over the summer and through the fall, the labor force participation rate has been fairly steady since June – currently measuring at 61.5% as of November – which is down almost 2 percentage points from its February levels.
People who have been temporarily laid off as a result of the pandemic have decreased again (by 441k) bringing that number down to 2.8 million, which is a fraction of the 18+ million temporary lay-offs that were registered in April. That said, there are still about 2 million more temporarily laid-off employees currently out of the workforce than there were prior to the pandemic hitting the US, so there is ground to be made up here as well.
On the other hand, the number of long-term unemployed workers (those who have been unemployed greater than 27 weeks) increased in November while workers who have been unemployed less than 27 weeks remained about the same. These figures track with the rate and timing of the economic recovery through the summer and fall, with some short-term unemployed workers becoming re-categorized to long-term unemployed as the pandemic arguably enters its 37th week now.
In sum, November continued the progress toward economic recovery and a return to pre-pandemic employment levels, but the trajectory is levelling off as the recovery loses speed. With COVID-19 cases and deaths climbing again in what appears to be shaping up into a third wave of infection across the US, it is entirely possible if not probable that recent recovery trends will slow to a stop as we move into the winter season, with the potential that some of the previous gains might be reversed if we start heading in the wrong direction again.
For more detailed information, please review the November Unemployment Detail at the below link: