Numbers: The US lost jobs for the first time in eight months in December as coronoviruses again bored the economy and forced businesses to resort to more layoffs.
The Bureau of Labor Statistics said the government and private sector took away 140,000 jobs last month.
The employment decline was the first since last April, when the US lost 20.8 million jobs in that one month.
The economy is still missing some 10 million jobs that existed before the onset of the epidemic, with the possibility that they would be regained at some point soon.
While the report had a glimpse of goods news, the layoffs focused on restaurants and other businesses that relied on large crowds of customers. Many other segments of the economy actually receive strong employment gains in the last month.
Meanwhile, the official unemployment rate was unchanged at 6.7%. Yet economists estimate that true unemployment is several points higher because the official unemployment rate does not include the nearly 4 million people who left the labor force last year.
Read: Unemployed claims are still very high at the end of 2020
“People leaving the labor force is a big problem,” said Thomas Barkin, president of the Federal Reserve.
In early trades, US stocks rose slightly. Dow Jones Industrial Average DJIA,
Set a new record on Thursday as investors see the current economic difficulties after a better time in the year as more people get vaccinated.
What happened: Customers drowned in 372,000 bars and restaurants as employment and several states re-enforced trade restrictions in an attempt to slow record growth in cases of coronovirus.
Many firms had to lay off workers for the second or third time and some had to close for good.
Theme parks, casinos and the like in entertainment – also declined by 92,000 and the hotel industry occupied 24,000 positions.
Added to the loss of jobs, there was a 63,000 decline in employment in private education and 45,000 in government.
The news was not all bad: employment has increased in other key sectors of the economy.
For example, a 161,000 increase in white-collar professional rank at retail outlets, and an increase in retail outlets, although retail employment was unlikely to be increased by seasonal swings.
Construction companies also added 51,000 jobs amid a surge in home sales, while manufacturers added 38,000 workers to their salaries. And there was a 47,000 increase in employment between shippers and transportation companies offering more packages than ever before in homes and businesses.
Hiring was also stronger in November and October than earlier reports. The number of new jobs created in November increased from 245,000 to 336,000. In October the job mileage was revised from 610,000 to 654,000.
big picture: The US economy has not been as badly hurt by the outbreak of coronovirus at the end of 2020 as it was during the early spring.
Yet the pace has clearly slowed down. Unless vaccination is more widespread and epidemic is feared, the pace of economic growth and hiring is unlikely to increase again. Unemployment is expected to be at least until summer.
What are they saying “This is a major setback for the labor market and the economy, but the narrow concentration of losses caused by the restrictions ultimately shed a positive light on vaccination,” said Sal Guattieri, senior economist at BMO Capital Markets.
“This is a standstill in recovery, not a full stall,” said Chris Low, chief economist at FHN Financial.
Market reaction: Dow Jones Industrial Average DJIA,
And the S&P 500 SPX,
Friday opened slightly higher in trades.
Investors are banking on a strong economy in 2021, aided by more federal stimulus from a Democratic president and Democratic-controlled Congress.