Quill Intelligence LLC CEO and Chief Strategist Danielle DiMartino Booth and Walser Wealth Management President Rebecca Walser on Fed economic policies, and President Biden raise the minimum wage.
The U.S. economy added 49,000 jobs in January, and increased due to a surprising decline in employment in December, as a slowdown in COVID-19 cases nationwide allowed it to ease enterprise closure measures.
The unemployment rate fell to 6.3% – well below the April high of 14.7%, but about twice the level before the crisis, the Labor Department said in its monthly payroll report, released on Friday. Economists surveyed by Refinitiv expected the report to show that unemployment remained unchanged at 6.7% and that the economy added 50,000 jobs.
In total, the U.S. recovered about half of the 22 million jobs lost during the first two months of the pandemic. There are still about 9.9 million more Americans out of work than in February before the crisis began.
After a sharp contraction in March and April, the labor market recovered rapidly, adding 9.3 million jobs in just three months. But since then, job growth has cooled dramatically every month, with economists increasingly warning that the recovery could be a plateau – or reversal.
The broader economic recovery has intensified in recent months: unemployment claims, a proxy for redundancies, remained about four times their level before the crisis. Consumer spending has fallen as Americans have stayed home – and those who have ventured have limited options. GDP, the broadest measure of goods and services, grew by just 1% in the last three months of the year, compared with an increase of 7.48% between the second and third quarters.
“It could take a few months for warmer weather, less COVID-19 and more consumer confidence before consumers go on a shopping spree that will provide the real stimulus and job creation,” said Dan North, senior economist at Euler Hermes, North America. .
This is an evolving story. Check back for updates.