The U.S. unemployment rate dropped to 6.9 percent in October as companies added 638,000 jobs to log the sixth consecutive month of job gains, the U.S. Labor Department announced on 6 November.
Private-sector employers added 906,000 jobs in October, offsetting 268,000 workers terminated from government jobs, primarily at the state and local levels.
The largest number of jobs were created in leisure and hospitality, particularly among restaurants as more reopened. Construction and retail also added significant numbers of workers.
738,000 new claims for state unemployment benefits, however, were filed during the same week, a figure little different from the week before.
An additional 363,000 claims were filed under the federal program paying unemployment compensation to part-time workers, gig workers, and others not qualified to receive state benefits.
The economic shutdown in March and April cost the economy 22 million jobs and sent the unemployment rate to 14.7 percent, the highest mark since World War II ended. Now, the U.S. economy has recovered about 12.1 million of those jobs, the Labor Department reported.
Monthly job gains have been shrinking since June, and new data from late October showed small businesses still shedding more jobs than they added. The figures show hiring slowing in the service sector overall.
About 16 percent of October’s new jobs were temporary, Gregory Daco, Chief U.S. Economist at Oxford Economics, told the Wall Street Journal, signaling that employers are uncertain about the economy’s short-term future.
Many restaurants, especially those in northern states, are ending outdoor service now that cold weather is setting in, which once again could cost jobs in that hard-hit sector.
TREND FORECAST: As state unemployment benefits end, consumers will curtail spending, which will lead businesses to a new round of layoffs. Many industries, such as airlines, tourism, hospitality, entertainment, and retail will not recover to pre-COVID War levels for at least two years. Thus, accounting for inflation and population increases, those levels will represent negative growth.
For example, the big news last week was U.S. economic output grew 7.4 percent in the third quarter… a record rate that annualized to a 33.1-percent recovery from the economic shutdown.
U.S. GDP, however, remained 3.5 percent lower than at the end of 2019. The 11 million workers still jobless are twice as numerous than before the pandemic, and millions more have stopped looking for work or have left the labor force entirely.
