In February, the United States created 379,000 non-farm jobs; however, the unemployment rate remains high at 6.2%. According to the Bureau of Labor Statistics (BLS), the effects of the pandemic are still being felt in the labor market. The unemployment rate among Hispanic and Black workers remain at 8.5% and 9.9%, respectively. Asian workers have the lowest unemployment rate with 5.1%, followed by white workers with 5.6%. In terms of gender, both men and women have similar unemployment rates at 6 % and 5.9 %, respectively.
The number of people temporarily out of work fell to 2.2 million, 517,000 fewer than in January. There are still 1.5 million people in temporary recalls, compared to February 2020.
The number of people affected by long-term unemployment (27 weeks without finding job) changed little with 4.1 million people remaining unemployed. In February, individuals affected by long-term unemployment totaled 41.5% of the unemployed population, while persons unemployed for less than 5 weeks stood at 2.2 million.
The BLS recorded that one of the main increases in hiring came from the lodging and service sectors that have returned to business following the lifting of mobility restrictions by several states. In fact, four-fifths of hiring came from restaurants and bars, which employed about 286,000 people.
The mass vaccination program also caused a considerable increase in hiring in the health sector, which created 46,000 new jobs during the month of February. Another highlight is that retail pharmacists such as CVS and Costco were also allowed to administer vaccines in their pharmacies, which significantly increased the demand for pharmacy technicians nationwide.
Meanwhile, retail created 41,000 jobs in February thanks to the lifting of restrictions in the states, which allowed the opening of so-called brick-and-mortar businesses. In that regard, let’s remember that the physical retail sector was hit hard by the 2020 closures and lost ground to e-commerce.
Manufacturing also rebounded with 21,000 new jobs in February. The ranking is led by equipment transportation with 10,000 new jobs, although the sector is still down 561,000 jobs from February of last year.
Despite fiscal stimulus, almost all government sectors saw a decline in the number of staff hired, with the hardest hit being the education sector which recorded 69,000 layoffs in local and federal government institutions during February.
Many jobs will not be coming back soon and others have ceased to exist altogether
Overall in the United States, there are about 9.9 million people out of work, a figure that could even rise to more than 15 million if the difference between February 2020 and 2021 participation rates is taken into account.
The participation rate measures the percentage of the working-age population that is employed or actively seeking employment, i.e., the sum of employed plus unemployed persons. Looking at the difference between February 2020 and February 2021, about 6 million people have stopped actively participating in the economy.
The Congressional Budget Office expects the United States to recover its pre-pandemic unemployment rate in 2024, standing at 3.5%. In order to recover the economy, the government implemented two stimulus programs in 2020 and will implement a third plan, which is about to be approved by the Senate. A recovery that will be financed at the cost of increasing the federal debt.
Meanwhile, the head of the Federal Reserve, Jerome Powell, confirmed that the Central Bank will keep interest rates close to 0% and will not raise them until the economy returns to full employment rates.
Despite the efforts of the government and the FED to inject money into the market, many of the jobs lost during the pandemic will not return. Some because they are no longer competitive, others because the companies that demanded them no longer exist.