In a sign the COVID-19 recession may have reached its nadir, the Department of Labor reported today that the nonfarm jobs market added 2.5 million jobs in May as leisure and hospitality, retail, and other sectors reopened amid relaxed quarantine orders. The unemployment rate fell 1.4 points to 13.3% from 14.7% in April. According to the survey, the number of unemployed people in the job market fell 2.1 million to 21.0 million in May.
Manufacturing added 225,000 jobs in May after losing 1.3 million in April, with the number of jobs added roughly evenly split between durable goods and nondurable goods. Durable goods, which lost 907,000 jobs in April and 359,000 in motor vehicle manufacturing, restored 225,000 jobs, including 27,000 in automobiles and auto parts; 25,000 in fabricated metal products and 23,000 in machinery. Nondurable goods lost 417,000 jobs in April and added 106,000 in May, with 30,000 new jobs in plastics and 25,000 in food manufacturing.
The leisure and hospitality sector contributed to almost half of the total increase: 1.2 million people resumed work in the industry. Over the course of the month, employment in food services and restaurants rose by 1.4 million. Construction regained 464,000 jobs compared to April’s loss of 995,000, while transportation and warehousing lost 19,000 more jobs after losing 553,300 in April.
Earlier this week, the Bureau of Labor Statistics released another report that suggested the nadir of the coronavirus recession has passed. The advance figure for initial unemployment insurance claims for the week of May 30 was 1.8 million. The number of new people applying for unemployment insurance has dropped steadily for nine straight weeks, suggesting rolling layoffs even as many companies are returning to business as usual. Despite the extended decline, it still remains more than twice as high as the previous record, set during the savings and loan crisis.
Troublingly, analysis suggests that even if the economy is recovering, it may not recover very quickly—and when it does, some jobs lost will stay lost. The Society for Human Resource Management, in partnership with Oxford Economics, found employers were focused on hiring skilled employees specifically. SHRM CEO Johnny Taylor, Jr., was skeptical the recovered economy would look the same as it did before COVID-19: “Yes, some jobs will come back. But, frankly, some are gone forever, and many of those that do return are going to be different.”
