The U.S. economy shed 140,000 jobs in December. This is the first monthly decrease in employment numbers since the recovery began. In 2020, the economy lost more than 9 million jobs. The unemployment rate remained at 6.7%. Year-over-year wage growth was at 5.1%.
The Numbers
-140,000: The U.S. economy shed 140,000 jobs in December.
6.7%: The unemployment rate remained at 6.7%.
5.1%: Wages rose 5.1% over the past year.
The Good
In the jobs report with the first losses in seven months, you have to look closely to see any good news. As Bloomberg reports, the job losses are in specific sectors, with other areas of the economy holding up. There were job gains in retail, professional and business services, construction and manufacturing, despite significant losses in other sectors.
CNBC reports the other bright spot is that despite an increase in temporary layoffs, permanent layoffs decreased in December.
The Bad
December’s jobs report indicates that the recovery isn’t just slowing down or stalling, its going in reverse, as the New York Times reports. The leisure and hospitality sector saw the biggest decrease with restaurants and bars cutting 372,000 jobs in December and hotels cutting 24,000 more. Education also saw a smaller decrease with private schools and colleges cutting 60,000 jobs.
Additionally, the losses had the greatest impact on women, and specifically women of color. As CNN reports, women accounted for all of the job losses in December, with 156,000, while men gained 16,000. (These numbers are cumulative, indicating while individual men lost jobs in December, those were offset by gains in men’s employment.) Women have already been disproportionally impacted by pandemic related job losses, with the unemployment rate for Latinas at 9.1%, Black women at 8.4% and white women at 5.7 percent.
The Unknown
Starting a new year, the U.S. economy faces a variety of factors that could impact the recovery. First is the impact of the coronavirus pandemic. Surging cases have been blamed for December’s job losses, and new strains recently identified in the UK have shown to be even more contagious.
Additionally, as the Wall Street Journal reports, these job losses come just as the most recent $900 billion coronavirus aid package kicks in, and president-elect Joe Biden has indicated another package could be on the way in early 2021.
