WASHINGTON • The US economy showed more signs that the recovery is stalling as Covid-19 cases surge and more businesses are forced to close, adding a disappointing 245,000 new jobs last month, the government reported yesterday.
And while the Labour Department data showed the unemployment rate dipped to 6.7 per cent from 6.9 per cent, the lowest since the pandemic struck, 10.7 million workers remain unemployed.
The ranks of long-term unemployed - those jobless for 27 weeks or more - rose by 385,000 to 3.9 million, and more Americans left the workforce entirely, the report said, as the participation rate dipped two-tenths to 61.5 per cent.
The consensus estimate was for a gain of 650,000 positions last month, but many economists warned the result could come in much lower, given signs that hiring had slowed last month as the coronavirus returned with a vengeance.
That was reflected in the loss of nearly 35,000 retail jobs in November. And as mostly lower-wage positions fall victim to the pandemic, average hourly earnings rose slightly to US$29.58 (S$39.40), according to the report.
Government employment fell by 99,000, largely due to layoffs of temporary census workers, while private hiring rose by 344,000, the report said.
The number of temporary layoffs dropped by 441,000 to 2.8 million, but that is two million higher than the pre-pandemic level.
The data raises the chances that President-elect Joe Biden will inherit an even weaker labour market next year, with the recovery at risk of stalling during the wait for widespread vaccine distribution. With almost four million Americans enduring long-term joblessness, the report may also help push Congress to pass new fiscal aid by year-end and could make Federal Reserve officials more inclined to provide new stimulus when they meet from Dec 15 to 16.
US stock futures pared their increase after the report, while 10-year Treasury yields extended gains and the dollar fluctuated. "You are seeing the impact of the pandemic surge here," Mr Jeffrey Rosenberg, a senior portfolio manager at BlackRock, said on Bloomberg Television.
"The market reaction is really looking through this to the policy response."
The employment report is a mid-month snapshot, so jobs lost amid new restrictions and lockdowns put into place in the weeks since will not be reflected until December's data.
The shift to online shopping this holiday season was especially evident in the data.
Transportation and warehousing added 145,000 workers - the most since 1997 - while retail employment fell by 34,700, reflecting less seasonal hiring than normal in some sectors. Leisure and hospitality jobs rose by 31,000 following a 270,000 gain in October.
Though effective vaccines could be rolled out as soon as this month, economic headwinds are likely to keep mounting before Mr Biden's Jan 20 inauguration.
AGENCE FRANCE-PRESSE, BLOOMBERG
