The US government is due to publish its monthly job report on Friday, and economists estimate that another 1.6 million jobs were added in July – a sharp slowdown from the 4.8 million added in June. This will lead to monthly unemployment of up to 10.5% in July, from 11.1% in June.
If these projections turn out to be correct, America will continue to cut about 13 million jobs from February, and the unemployment rate will continue to be higher than at the peak of the financial crisis in 2007-2009.
Although most economists say the pace of recovery slowed in July, some say it has reversed.
Lydia Busur, a senior U.S. economist at Oxford Economics, says she expects Friday̵
7;s report to show a loss of 280,000 jobs, not a profit. This will signal even more clearly that the base of the restoration is cracking.
Wednesday’s employment report on Wednesday, which is the equivalent of the private sector job report and based on a different study, disappointed expectations – dramatically. The report shows only 167,000 jobs added in July, compared to an expected 1.5 million.
Another survey of government jobs conducted by the Census Bureau found a drop in jobs last month.
Meanwhile, President Donald Trump boasted that America would see “another large number of jobs on Friday” during an interview with Fox on Wednesday morning. Trump said he had not yet seen the job numbers, for which he received a review.
Initial claims for unemployment benefits intensified around mid-July, ending a four-month decline. However, a report by the Labor Ministry on Thursday showed that initial requests for regular unemployment benefits were declining again.
“July is so uncertain because some areas, some sectors continued to open at the beginning of the month, and then things started to change,” said Gianet Garrett, chief economist at Robertson Stevens Wealth Management.
This has been boosted by federal money for businesses through the expired payroll program, she added. Democrats and Republicans in Congress are still struggling to build another stimulus package.
It has been more than three months since the pandemic devastated the American labor market, leading to the worst job losses in the record and the highest unemployment rate since the Great Depression.
The situation has improved since then, but we are far from normal.
Not all sectors are recovering at the same pace. There may be more layoffs in the hospitality industry as some states suspend plans to reopen, but other areas of the economy, such as manufacturing and construction, may have added jobs.
Lawmakers are billions of dollars apart
No matter where Friday’s numbers come from, pressure is on lawmakers in Washington to respond. Politicians will jump on the report to show either improvements in the job market or how many people are losing their jobs.
Congress is still trying to meet the conditions for the next round of stimulus measures. Last week, Democrats and Republicans were literally billions divided in their proposals.
The main controversy is the $ 600 federal incentive for regular unemployment benefits, which expired last week. Cabinet President Nancy Pelosi said earlier this week, “If unemployment falls, then that number could fall.”
Many Republicans say the $ 600 compensation keeps people from returning to work, while Democrats say workers stay home because it is not yet safe to return to work or because they need to focus on caring for children.
“There is there are still far fewer job opportunities for people than before, “Nick Bunker, director of research at Really Lab Hiring, told CNN Business.
Job ads are still about 18% below where they were at the same time last year, although the trend has improved since the spring, Bunker said.
Economists believe that people who have lost their jobs will return to work while the economy recovers, but many positions will not return for a very long time, if at all.