Job growth slows in September

While the latest employment report shows gains for September, the pace of hiring has slipped.

The economy added 661,000 jobs in September as the unemployment rate decreased to 7.9% compared to 8.4% in the previous month, the Bureau of Labor Statistics reported today.

As the unemployment rate fell with the number of unemployed persons declining by 1 million, marking five consecutive months of decreases, both rates remain higher than they were in February prior to the spread of the COVID-19 crisis in the United States.

The economy added 1.4 million jobs in August.

Retail trade added 142,000 jobs over the month, with a 40,000 increase in clothing and clothing accessory stores as general merchandise stores added 20,000 jobs. But retail jobs remain 483,000 lower than in February.

Construction employment increased by 26,000 in September, with growth in residential specialty trade contractors, up16,000, and construction of buildings rising by 12,000. Construction employment is below its February level by 394,000, the bureau reported.

Wholesale trade added 19,000 jobs, with gains in both the durable and nondurable goods components but is down 312,000 from February. Transportation and warehousing rose by 74,000 in September, including 32,000 jobs in warehousing and storage, but remains 304,000 below the February level.

Manufacturing rose by 67,000 jobs but remains down by nearly 647,000 jobs from February.

Lawrence Yun, chief economist of the National Association of Realtors, notes that the economy needs an additional 9 million job additions to match the pre-pandemic employment conditions when the unemployment rate was 3.5%. 

The economist also identifies a pattern developing between states with some of the lowest unemployment rates in comparison to those with higher rates.

"It is worth noting the vast divergence that has developed among states," Yun said. "Five states have unemployment rates below 5%: Idaho, Nebraska, South Dakota, Utah, and Vermont. But states with a stricter and longer lockdown, or heavily dependent on tourism, have unemployment rates above 10%, such as New York, California, Illinois, Nevada, and Hawaii."

"Let’s hope for some additional stimulus measures to get the economy moving faster," Yun said.

The bureau also reported that 22.7% of employed persons teleworked because of the coronavirus pandemic, down from 24.3% in August. The latest data includes employed persons who teleworked or worked at home for pay at some point in the last 4 weeks, specifically because of the pandemic.

The full September Employment Situation Summary from the Bureau of Labor Statistics is available here.