November jobs report shows COVID is still the boss

Nearly two years in, the pandemic is still in control of the economy.

The nation’s employers added just 210,000 jobs on net in November, the Bureau of Labor Statistics reported Friday. This was far below forecasts, which predicted about 550,000 new jobs for the month.

This lower-than-expected job growth comes as inflation is pinching consumers and employers. The new omicron variant also poses a threat to the economic recovery. But there’s still reason not to be too negative about the November report itself. For one thing, it’s possible this preliminary number understates the pace of hiring. Previous months have been revised upward quite a bit lately as more data trickled in. One reason to believe more upward revisions might be in store for November is that another Bureau of Labor Statistics survey painted a much rosier portrait of the labor market. Those survey results, also released Friday,

showed a steep drop in unemployment, down to 4.2%.

The unemployment rate was never that low during the entire mid-2000s boom.

If you take the 210,000 jobs number at face value, though, it shows that we still have a very long way to go in digging ourselves out of this hole. At that pace, it would be another year and a half before the economy recovered all the jobs lost since the beginning of the pandemic. And presumably we want more positions than just the prepandemic level, as the working-age population has grown in that time.

The pandemic also continues to affect the shape the recovery is taking and where jobs are (or aren’t) being added.

Hiring in leisure and hospitality slowed dramatically in November, for example. One might wonder if that’s because customers still aren’t interested in dining out and traveling, and therefore employers in these businesses don’t need many more staff; or if employers do need more staff but can’t find workers. One

reason to believe it’s the latter is that wage gains for this sector are practically off the charts.

Year over year, these workers’ (non-inflationadjusted) hourly wages are up 12.3%. Tons of job openings remain.

At this point, it’s hard to blame expanded unemployment benefits, which ended in September. That said, many households have a greater cash cushion thanks to a year-and-ahalf’s worth of accumulated

savings, which are partly due to those unemployment benefits and other generous government transfers. This gives workers more flexibility if they need to put off returning to work, or if they want to be choosier about what job they return to. Many workers have suggested their career priorities have changed

There are other barriers to returning to work.

Schools have reopened, but students are still intermittently forced into quarantine

or remote learning because of coronavirus outbreaks. This disrupts parents’ ability to hold down a job. The child-care sector, which was already inadequate pre-covid, was hobbled by the pandemic. Hiring in the industry picked up initially but has stalled out.

As of November, childcare employment was still 10% below its level in February 2020.

And of course, even with most of the eligible

population vaccinated, Americans are still contracting COVID-19.

The emergence of the omicron variant could substantially change numbers, too. If it proves to be more transmissible or severe than previous strains of the coronavirus, we could see more worker absences, withdrawals from the labor force, temporary shutterings of schools or child-care providers, etc. There seems to be little appetite for government-imposed shutdowns

here in the United States, but other countries around the world might end up imposing more compulsory closures of businesses or regions, as happened with the delta variant. That, too, would have downstream effects for the U.S. economy.

Which is why, once again, the key to solving the economic crisis is solving the public health one first. We need vaccination rates much higher, both here and around the world. More jabs, more jobs.