The American job engine has slowed significantly, stranding millions of people who have not yet found work after the pandemic halt, and providing fresh evidence that the recovery is stalling.
The Labor Department reported Friday that employers created 245,000 jobs in November, less than half of those created in October. The pace of recruitment has now decreased for five months in a row.
While many of the unemployed at the start of the pandemic have been reinstated, there are around 10 million fewer jobs than in February. Many of the unemployed are weeks away from losing benefits they received. The emergency aid approved by Congress last spring will expire at the end of the year.
The most recent sign of economic headwinds came as members of Congress struggled to reach an agreement on a new aid package. A bipartisan group of lawmakers tabled a $ 900 billion proposal, and House spokeswoman Nancy Pelosi said the disappointing employment report should get negotiations going.
President-elect Joseph R. Biden Jr., who warned of a “dark winter,” stressed the urgency of congressional action. “This is a grim job report,” he said in a statement. “It shows an economy that has stalled. This confirms that we are in the midst of one of the worst economic and employment crises in modern history. “
The number of Covid-19 cases has doubled in the last month and is expected to keep increasing, discouraging people from in-store shopping and leading to new restrictions. And in much of the country, colder weather can hinder the outdoor dining that many restaurants have relied on.
“We are currently in an unusual position in business,” said Ernie Tedeschi, an economist at accounting firm Evercore ISI. “There is sunlight in the distance,” he said based on advances in coronavirus vaccines, but by then “we will have some of the toughest months of this pandemic and there will still be many scars left.” heal.”
One of the more lingering wounds is likely to be large numbers of people – many of them still in their prime working age – who are leaving the world of work and being withdrawn from employment even when opportunities arise.
The proportion of 16-year-olds or older who have a job or are actively looking for one fell to 61.5 percent in November and is well below the level before the pandemic. The decline was particularly noticeable among women, who are strongly represented in the service industries most affected by the pandemic – such as retail and hospitality – and who tend to leave the labor market due to family commitments.
The seasonally adjusted unemployment rate fell from 6.9 percent to 6.7 percent in November. However, this was mainly due to the fact that more people gave up looking for work.
“Temporary unemployment has fallen, but permanent job losses have increased,” said Jed Kolko, chief economist on the job search website. Slight gains have already been made as employers recalled briefly displaced workers, making later progress difficult.
“Measures for longer-term damage worsened slightly in November,” he said.
The total number of jobs last month was partially impacted by the loss of 93,000 temporary census workers who will no longer be needed after the official census ends.
But even in the private sector, “the momentum is slowing,” said Kathy Bostjancic, chief US financial economist at Oxford Economics.
While hardship can be found in almost every pocket on the job market, the pain is unevenly distributed. This downturn, like the previous ones, is likely to widen wealth and income gaps and harm the least educated.
Unemployment among black and Hispanic workers was significantly higher than among whites in the last month, partly because they have a disproportionate share of service jobs.
Gabriela Villagomez-Morales, 36, was fired from her position as assistant teacher at a daycare center in Tacoma, Washington, after the March pandemic hit and schools closed.
Ms. Villagomez-Morales, a single mother of four, couldn’t pay the $ 1,000 rent on her house, so she packed up and moved in with her sister and two children.
She applied for jobs in restaurants and daycare. Although she has not yet found a job, she worries what will happen to her children if she does.
“It would be difficult because someone would have to watch my children when I am not home,” said Ms. Villagomez-Morales. “Childcare is very expensive.”
There have been some signs of energy in the labor market. With the pandemic keeping shoppers away from stores and employees who work from home, it’s no surprise that some of the biggest gains in November were in storage and moving of goods, as well as healthcare.
Business and professional services employers also continued to hire, although large parts of the economy – such as hospitality, travel, and entertainment – are still faltering.
Becky Frankiewicz, president of recruiting and recruiting company ManpowerGroup North America, said a survey of all publicly advertised positions found 11 million open positions in November, one million more than the previous month.
“We continue to see weekly employment growth,” said Ms. Frankiewicz. “We’re nowhere near where we were, but we’re still limping along with the recovery.”
Seasonal adjustments have been made, but the composition differs from that in previous years. Rather than adding positions at cash registers, salesrooms, and call centers, employers are taking on employees to work in warehouses and handle customer service calls from home.
“We hired several thousand people for seasonal vacation promotions last week, and there are many open positions for work-from-home opportunities,” said Amy Glaser, senior vice president of recruitment firm Adecco.
Ilias Simpson, the executive director of Radial, which handles e-commerce for retailers and other businesses, said the company hired 15,000 seasonal workers, nearly tripling its North American workforce for the holidays.
“We’ve been hiring since October,” said Simpson, noting that Radial is projected to be hiring 40 percent more people than last year. “We are in the middle of the high season.”
He plans to hire several thousand workers, some of them permanent, over the next six months.
Last year, when the unemployment rate fell below 4 percent, news that employers had put nearly a quarter of a million people on the payroll in a single month would have been enthusiastically received. But circumstances have changed radically in a short period of time.
Millions more people are now unemployed. The broadest level of unemployment that includes workers who work part-time but prefer full-time work or who have given up looking for a job has been 12 percent for the past two months.
If job creation does not increase, it will take more than three years to return to the pre-pandemic labor market.
Wendi Wilson, 54, has been unemployed since March. She had worked as a brand ambassador for six years, helping companies sell products at conferences on the Las Vegas Strip. In doing so, she earned around $ 35,000 a year.
Her state unemployment benefit was $ 115 a week, which was topped up by $ 600 for a while before it ran out in the summer.
Ms. Wilson struggled to pay the $ 1,170 rent for her two bedroom apartment in Summerlin, Nevada, and a $ 460 monthly car payment.
In August, her unemployment benefit was suspended, but she said she was unable to contact the labor office to get the extension to which she is entitled. So Ms. Wilson used her savings to pay bills, including depositing into her retirement account. She also depends on donations from friends.
“I’m out of savings and that’s scary because of my age,” she said. “I’m not used to relying on others to help me and I don’t like it.”
Gillian Friedman and Jeanna Smialek contributed to the coverage.