October’s Jobs Gains Lift U.S. Claw-Back Ratio to 50.9%; Canada’s to 78.9%

Article source: ConstructConnect

October’s Employment Situation report from the Bureau of Labor Statistics (BLS) records a +638,000 pickup in U.S. total employment, not much different from September’s increase of +672,000.

The U.S. seasonally adjusted (SA) unemployment rate in the latest period improved to 6.9% from 7.9% in the prior period. The not seasonally adjusted (NSA) unemployment rate showed similar movement, downshifting to 6.6% from 7.7%.

Versus the huge drop in total employment from February to April of this year, the U.S. economy has now managed a jobs recovery ratio of 50.9%. That’s progress, but it certainly doesn’t warrant being called wonderful. At least with respect to the labor market, a V-shaped recovery has not materialized.

Total U.S. employment year over year presently stands at -6.1%, comprised of services at -6.7%; manufacturing, -4.5%; and construction, -2.6%.

The construction jobs jump in October was a noteworthy +84,000, leaning more towards to nonresidential work than residential. This runs counter to the expectation that it will be housing starts that will provide sustenance to the industry over the next little while.

Construction’s NSA unemployment rate is currently 6.8%, better than the previous month’s 7.1%, but considerably elevated from its year-ago level of 4.0%.

Earnings in construction are still notably lagging earnings for all jobs. Whereas the all-jobs compensation gains in October were +4.5% y/y hourly and +5.7% weekly, hard-hat workers made only +2.8% hourly and +1.5% weekly.

Big Chunks out of Government Employment

Table 1 summarizes the jobs performances in major sectors, February to April, then from April to the present. The final column showing jobs-recovery ratios is what’s most important.

Construction has one of the better jobs claw-back ratios (69.8%), second only to retail (76.4%).

The negative claw-back ratios for two sectors, information services (-3.1%) and government (-24.1%), indicate they have not made any progress in restoring employment since April, but have rather shed more positions.

The government staffing situation in October was particularly bleak, -268,000 jobs month to month. Washington’s contraction of -138,000 was about equaled by the combined declines with state and local administrations (-65,000 each). Public sector jobs in education took the biggest hit (-159,000).

U.S. accommodation and food services jobs are still severely depressed, -19.9% year over year and -20.7% when compared with February, the last ‘normal’ month prior to the coronavirus outbreak.

Table 1

In Jobs Recovery, Canada has Something to Crow About

As reported by Statistics Canada, employment north of the border in October rose by 84,000 jobs. The cooling of re-opening efforts, due to the coronavirus ‘paying another visit’, is having a detrimental effect.

The +84,000 number for September is much lower than the other month-to-month figures since the spring. September was +378,000; August, +246,000; July, +419,000; and June, +952,000.

Canada’s SA unemployment rate barely moved in the latest month, going to 8.9% from 9.0%.

The same held true for the R3 NSA jobless rate, as it shrank to 7.1% from 7.3%. The R3 number is Canadian unemployment calculated according to the same stricter methodology ‒ i.e., with respect to who among the out-of-work are making a concerted effort to be hired ‒ as is adopted in the U.S.

The Canadian construction jobs uplift in October was a relatively restrained +8,400. The month-to-month change was +0.7%, but the year-over-year status was -5.8%.

But there’s one thing Canada can crow about. Its total jobs claw-back ratio is a pretty impressive 78.9%, much better than what has been achieved south of the border.

With respect to hotel/motel and bar/restaurant jobs, though, it’s remarkable that Canada and the U.S. are struggling to almost the same degree. Canada is -19.4% year over year and -19.2% versus February. (The comparable figures for the U.S. are -19.9% and -20.7%.)

For easy and quick reference, Table 3 has more U.S.-Canada jobs market comparisons.

Table 2

Table 3

Category: ConstructConnect

This entry was posted on Friday, November 6th, 2020 at 10:53 am. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.