The end of the 2020 census and the loss of its workers masked a robust 906,000 increase in private-sector payrolls in October that was far stronger than the implied figure of 638,000 would suggest.
The unemployment rate fell to 6.9% even as 724,000 workers re-entered the workforce.
In addition, the decline in the unemployment rate to 6.9% occurred even as 724,000 workers re-entered the workforce, bringing down the official number of unemployed to 11.06 million, according to Labor Department data released on Friday. The underemployment rate declined to 12.1% from 12.8%, but that figure is well above the 6.9% of a year ago.
Permanent job losses held steady at 4.5 million. Once one accounts for those who are not in the labor force but want a job, our estimate of the unemployment rate is 8%. Although this is unequivocally another strong month of employment data, the report demands to be put in context.
While the economy remains resilient and the jobs recovery continues, one remains concerned about the loss of fiscal support and the intensification of the pandemic. It is clear that the economy still needs support, and once the rancor around the election abates, we think that a lame-duck fiscal aid program would be well-received and cushion the blow of another wave of the virus. Yes, we have recovered more than half of the jobs lost during the worst of the crisis, but there are miles to go before policymakers can declare victory.
As expected, construction employment increased by 84,000, while manufacturing advanced at a 38,000 pace on the month. Private service-providing occupations increased by 783,000, with the bulk of the worker recalls occurring in leisure and hospitality and business services. Those sectors advanced by 271,000 and 208,000, respectively. The government sector declined by 268,000, with 147,000 temporary census workers exiting the payrolls as the national count was completed.
Inside the report, the Bureau of Labor Statistics provided a bevy of interesting data points from the supplemental household survey. In October, 21.2% of employed people teleworked because of the coronavirus pandemic, down from 22.7% in September. These figures refer to employed people who teleworked or worked at home for pay at some point in the last four weeks specifically because of the pandemic.
In October, 15.1 million people reported that they had been unable to work because their employer closed or lost business because of the pandemic—that is, they did not work at all or worked fewer hours at some point in the last four weeks. This measure is down from 19.4 million in September.
Among those who reported in October that they were unable to work because of pandemic-related closures or lost business, 11.7% received at least some pay from their employer for the hours not worked, up from 10.3% in September. About 3.6 million people not in the labor force in October were prevented from looking for work because of the pandemic. This is down from 4.5 million in September.
For more information on how the coronavirus is affecting midsize businesses, please visit the RSM Coronavirus Resource Center.
