WASHINGTON, Feb 5 (NNN-AGENCIES) — A nationwide drop in Covid-19 cases and improvements in economic indicators have raised hopes that the US labor market is on the upswing, and government data due out Friday could show how strong that recovery is.
The Labor Department is set to release its January employment report, which will provide the latest unemployment rate and show how many jobs the economy added or lost last month.
The December report brought ill tidings, with the unemployment rate flat at
6.7 percent as the economy lost 140,000 positions after states imposed new
business restrictions to cope with surging coronavirus infections.
In the weeks since, the United States has seen a nationwide decline in new
cases, prompting states to ease those measures, and government and private surveys have picked up signs of improvement.
Business shutdowns starting in March to stop Covid-19 from spreading caused mass layoffs and a surge in the unemployment rate to 14.7 percent, but it has declined in the months since, albeit at an increasingly slow rate.
The December report was the first contraction in payrolls since the crisis
began, though the drop did not change the overall jobless rate.
The weeks to follow have brought signs hiring is improving.
The Labor Department reported new claims for jobless benefits declining for the past three weeks straight, though the monthly employment report covers the week containing the 12th of the month, and might not capture all of those improvements.
Payroll services firm ADP data this week showed the private sector adding
174,000 jobs in January, a result nearly triple analysts’ forecasts —
although that report can vary widely from the official figures.
“Given how fast the economy has rebounded from the spring collapse, a
slower, but still decent growth rate is likely,” economist Joel Naroff said,
predicting that the wide-ranging government data could show payrolls
increasing by up to 300,000.
But other economists are much less optimistic, and the consensus forecast
is for a gain of only 50,000 jobs.
US President Joe Biden has pressed for $1.9 trillion in stimulus spending
to support the economic recovery, and the White House has said a one-month jobs gain will not alter the need for the aid.
While that package may ultimately be whittled down by a cost-conscious
Congress controlled only narrowly by Biden’s Democrats, its provisions aimed at keeping the unemployed and small businesses afloat could spur further hiring later in 2021. — NNN-AGENCIES
