U.S. Economy Lost 140,000 Jobs in December, Unemployment Unchanged at 6.7%
The U.S. economy shed 140,000 jobs in December and the unemployment rate held steady at 6.7 percent, according to data released Friday.
Economists surveyed by Dow Jones had forecast an addition of 50,000 jobs and a slight rise in the unemployment rate to 6.8 percent.
“The decline in payroll employment reflects the recent increase in coronavirus (COVID-19) cases and efforts to contain the pandemic,” the Labor Department said.
The economy has added around 12.2 million jobs in the past eight months, a record-breaking pace after the unprecedented collapse in employment as lockdowns took hold in March and April. The increase in the ranks of employed workers shows that companies ramped up hiring as the economy reopened and consumers came back to stores, restaurants, and other businesses that had been shuttered this spring. Despite the gains, total employment in December was lower than its February level, highlighting just how deep the pandemic cut into what had been the strongest jobs markets in decades.
Hiring slowed in November and layoffs picked back up as infections, hospitalizations, and deaths surged. Many state and local governments around the country announced new restrictions on business, travel, dining, and other activities that have once again suppressed demand and discouraged growth in employment. Some businesses that held on through the first wave of shutdowns have not been able to stay in business in the second wave and much of the government aid made available earlier last year was no longer offered in December.
And even throughout the reopening layoffs have been extremely elevated, indicating that the pandemic’s effects are still ravaging the economy. A separate report on Thursday showed that 787,000 Americans applied for unemployment benefits in the prior week and 790,000 in the week before that. Jobless claims can be volatile week to week so many economists prefer to look at the four-week average. This rose to 818,750, a decrease of 18,750 from the previous week’s upwardly revised level.