High inflation, supply-chain disruptions, nonconstructive partisan rhetoric in Washington, D.C. and a surge in the spread of the Delta variant led to a disappointing jobs report for September. The Department of Labor said that employment only rose by 194,000 in September, as opposed to an anticipated increase of 500,000 new jobs.
Announcing the data in real time, CNBC reporter Steve Liesman said, “That is real low.” Liesman added, “It was weaker than expected.”
The unemployment rate declined to 4.8%, while the expectation was for it to be around 5.1%. Making up for some of the enormous job losses during the beginning of the virus outbreak, the leisure and hospitality sector, representing roles in restaurants, bars, hotels and travel, once again led job creation. About 74,000 jobs were added in this area. Other drivers of growth were seen in professional and business services, which added 60,000 new jobs, and retail saw a boost of 56,000 hires. There was a nearly 125,000 drop in government payrolls.
A major problem for many Americans is the staggering amount of people who have been unemployed for over 27 weeks or longer. Nearly 3 million people have been without a job for over six months. This represents 34.5% of the total unemployed in September.
Experts point to the continued spread of the Delta variant as an inhibitor of job growth. Although there are nearly 11 million jobs available, the highest on record, the Labor Department’s numbers suggest that people are not actively hunting for or accepting job offers.
The labor force participation dropped down to 61.6% from 61.7%. This indicates that potential unemployed job seekers are pulling themselves out of the interview process. Without open roles being filled, it could delay the full recovery of the economy. The U.S. has about 5 million fewer jobs in August compared with February 2020.
In addition to people being concerned about catching Covid-19, job applicants are sitting on the sidelines because of childcare challenges. Another big factor is a change in mindset of workers.
The “Great Resignation” trend had millions of people quit their jobs. They are making a statement. People are sick and tired of working in dead-end jobs, suffering with too-demanding bosses, low wages and shabby treatment. They’d rather take their time and find a job that offers more money, some meaning, fulfillment and a sense of purpose.
Source: Forbes
