U.S. and Canada Suffer Employment Setbacks in December

Article source: ConstructConnect

December 2020’s total employment figure in the U.S. declined by -140,000 jobs, according to the Bureau of Labor Statistics (BLS). Neither is this a surprise, nor is it quite as dire as it first seems.

The weekly jobless claims number has remained above 700,000 for 42 weeks in a row and it is still higher than the maximum level (655,000) that was reached in the 2008-2009 recession. Not much good on the jobs creation front will occur until the number of first-time unemployed begins to drop significantly.

And, of course, the new layoffs are coming as a result of surging coronavirus cases. Bars and restaurants that had been re-opening have been forced to cease or scale back operations once again.

Also, there’s been a revision to the previous month’s jobs count that somewhat alters the narrative. The latest estimate of November’s total employment has risen by +135,000 versus what was originally reported.

Therefore, the ‘truer’ net change in America’s total jobs count in the latest month was close to zero (-5,000).

The seasonally adjusted (SA) unemployment rate in December stayed at 6.7%, the same as in November, while the not seasonally adjusted U rate increased slightly, to 6.5% from 6.4%.

The jobs recovery or claw-back ratio, relative to February-April’s plummet in employment, stayed flat in the latest month, at 52.1%.

A number of industrial sectors managed quite respectable increases in employment in December, including construction, +51,000 jobs.

Other than construction, the biggest nominal gains were registered by ‘professional and business services’, +161,000 jobs; ‘retail’, +120,000 jobs; ‘transportation and warehousing’, +47,000; and ‘manufacturing’, +38,000.

Unfortunately, those jobs improvements were not able to withstand the onslaught of losses in ‘government’, -45,000 jobs; ‘education and health’, -31,000; and most consequential, ‘leisure and hospitality’, -498,000.

The -45,000 figure for government jobs resulted from shrinkages of -32,000 and -19,000 at the ‘local’ and ‘state’ levels, while there were 6,000 net hires by Washington.

‘Education and health’s’ jobs drop of -31,000 was comprised of -63,000 for ‘educational services’ and -7,000 for ‘social assistance’, while ‘health care’ payrolls expanded by +39,000.

‘Hospitals’ added +32,000 staff members.

‘Food Services and drinking places’ (-372,000 jobs) accounted for three-quarters of the ‘leisure and hospitality’ sector’s jobs carnage.

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Canada Watches 63,000 Jobs Disappear

Similar to the U.S., Canada experienced a weakening in labor market conditions in December.

Canada’s total jobs count declined by -63,000 jobs, causing the jobs-recovery ratio to retreat from 80.9% in November to 78.8% in December.

Almost all of the -63,000 figure for total jobs originated in ‘accommodation and food services’, -57,000.

Canadian manufacturing employment in the latest month was +15,000, but the number of construction jobs was -3,000.

One of the few pieces of good news contained within Statistics Canada’s December Labor Force report was that full-time jobs in the latest month were +36,000. It was part-time work that suffered the ‘slings and arrows’ of severe layoffs, -99,000.

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Category: ConstructConnect

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