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US Job Recovery Slowed Dramatically in July as New Cases Spiked

Aug. 7, 2020
Manufacturing added only 26,000 jobs in July, a swift deceleration compared to June gains of more than 300,000.

The U.S. added 1.8 million new jobs and the unemployment rate fell 0.9 points to 10.2% in July. Despite the growth in jobs, the figure, published by the Bureau of Labor Statistics, marks a sharp deceleration compared to June’s recovery, which saw the U.S. add 4.791 million new nonfarm jobs. Manufacturing added 26,000 new jobs in July after adding 356,000 positions in June.

Despite growth in May, June, and July, unemployment remains 6.7 points higher than it was in February, and the Department of Labor says that 10.6 million more people are now unemployed than were in February.

In manufacturing, durable goods added 15,000 new net jobs, almost 20 times fewer than it added in June (290,000). If it had not been for continued gains in transportation equipment, the number of people employed in durable manufacturing would have actually fallen, as motor vehicles and parts manufacturing marked 39,300 new jobs.

Employment in almost all other segments of durable-goods manufacturing lost jobs, including wood products (which lost 1,300 jobs), primary metals (which lost 1,200), fabricated metal products (lost 11,400), machinery (-6,700), computer and electronic products (-6,400), and electronic equipment and appliances (-4,500). All told, if gains in transportation equipment manufacturing were excluded from new manufacturing jobs, durable goods manufacturing would have lost 24,300 jobs.

Nondurable goods added 11,000 jobs last month, compared to 67,000 in June. As during last month, food manufacturing saw the lion’s share of growth as the pandemic sustains altered eating habits among consumers.

The slacking pace of the recovery is reflected by initial unemployment insurance claims. The most recent report, for the week ending August 1, shows that the number of initial claims remains above one million for 20 weeks running. In a sign of further trouble for employers relying on government funds, the Payroll Protection Program is currently slated to expire Saturday, August 8. Started in April as part of the CARES relief bill, the PPP ran out of money in less than two weeks before being extended twice.

About the Author

Ryan Secard | Associate Editor

As talent editor, Ryan Secard reports on workforce and labor issues in manufacturing, including recruitment, labor organizations, and safety. Ryan has written IndustryWeek's Salary Survey annually since 2021 and coordinated its Talent Advisory Board since 2023. He joined IndustryWeek in 2020 as a news editor covering breaking manufacturing news.

Ryan also contributes to American Machinist and Foundry Management & Technology as an associate editor.

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