U.S. sheds 701,000 jobs, ending a record hiring streak
WASHINGTON – Employers in the United States shed 701,000 jobs last month, the government said Friday in a grim report that nonetheless only captured the early days of the economic devastation wrought by the coronavirus outbreak.
The March employment report was based on data from the first half of the month, before the global pandemic forced widespread business shutdowns and mass layoffs across the country.
Even so, the March decline in payrolls was the largest since the Great Recession and ended a record streak of 113 months of job gains.
The nation’s jobless rate went up last month to 4.4% from 3.5% in February, and that was the biggest one-month increase in unemployment since January 1975, when the country was in recession.
That is nothing compared to what economists said will be the jump in next month’s unemployment rate.
Based on some 10 million people having applied for unemployment benefits in the last two weeks of March – and still millions more laid-off workers waiting in the wings – analysts said the jobless rate will shoot up to 10% or higher in the April data.
Some economists are predicting the unemployment rate will approach 20% this spring, which would be about double the record high since World War II and come frighteningly close to the 25% level during the Great Depression.
“The March report is just a sneak peek of what is to come,” said economists at Bank of America.
Labor Secretary Eugene Scalia acknowledged as much: “We know that our report next month will show more extensive job losses,” he said in a statement. “America’s workers and their families are making purposeful sacrifices to help save lives.”
The March report, understated as it was, showed that the job loss was far bigger than what many analysts were expecting, largely because hotels, restaurants and drinking establishments had begun mass layoffs early in the month.
The leisure and hospitality sector lost 459,000 jobs in March, wiping out in one month nearly all of the gains over the last two years.
Retail trade shed 46,000 jobs as clothing stores, furniture sellers and sporting goods outlets began to shutter. The one retail business that held steady was food stores.
Jobs in health care and social assistance fell by 61,000, with dentists and doctors closing offices or reducing hours, and child care services starting to close their doors.
Manufacturing, wholesale, finance and transportation, including airlines, on the whole saw little job loss over the month, but that will change in the April report.
The unemployment rate in February was a 50-year low of 3.5%, and the tight labor market in the last year had begun to draw more people into the workforce and provide opportunities for disadvantaged workers.
But that ended virtually overnight. Jobless rates in March rose across gender, age and education.
The biggest jump in unemployment by age was among young adults ages 20 to 24; their jobless figure increased to 8.7% last month from 6.4%.
For prime-age workers 25 to 54 years old, unemployment rose to 3.6% from 3%.
The number of unemployed who reported being on temporary layoff more than doubled in March to 1.8 million.
Also, there was a sharp 1.4-million increase in people who reported working part time because their hours had been reduced or they were unable to find fulltime jobs, said the Bureau of Labor Statistics.