The U.S. economy added 1.8 million jobs in July and reported a declining unemployment rate of 10.2%, according to new figures released Friday morning by the U.S. Bureau of Labor Statistics.
The new unemployment rate is still above the October 2009 Great Recession high of 10%.
The acceleration of the viral outbreak that began in late June more than doubled the daily U.S. confirmed case count by mid-July, though the rate of new reported cases has since declined. The outbreaks have led many states and cities to close bars and other businesses for a second time and have dampened confidence, causing many consumers to continue limiting their shopping, traveling, eating out and gathering in crowds.
July’s job gain was much lower than June’s 4.8 million and May’s 2.7 million jobs, both of which were revised slightly.
The economy is struggling to emerge from the devastating recession that caused the economy to shrink at a nearly 33% annual rate in the April-June quarter, the worst quarterly fall on record. Employers slashed their workforces, consumers cut spending and corporations pulled back on investment and expansion.
The economy has since started to grow again, and many economists have forecast a solid rebound in the July-September quarter, though not nearly enough to offset the second quarter’s dizzying fall.
Economists predicted employers would add 1.6 million jobs, according to a survey by data provider FactSet. They also expected an unemployment rate of 10.5%.
“Today’s report sends one clear message,” said Josh Lipsky of the Atlantic Council. “Without more stimulus, the bottom could fall out from the American economy. Millions of unemployed citizens, renters across the country, small business owners, and every state government are asking for help in a time of crisis. We can worry about the price tag later. When your house is on fire you don’t ask the fireman how much the hose costs. Every day Congress delays raises the chance of a double-dip recession.”
On Thursday, the U.S. Department of Labor announced 1.1 million more Americans filed for unemployment last week.
That number is less than the previous week’s number of 1.4 million. The new numbers come as the critical $600 weekly federal jobless payment expires.
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The number of jobless claims declined by 249,000 from the previous week, after rising for two consecutive weeks, and it was the lowest total since mid-March.
This is the 20th consecutive week that at least 1 million people have sought jobless aid. Before the pandemic hit hard in March, the number of Americans seeking unemployment checks had never surpassed 700,000 in a week, not even during the Great Recession of 2007-2009.
Growth rebounded in May and June. But the viral outbreak reintensified in late June, doubling the nation’s daily confirmed case count to more than 60,000.
Two bright spots for the economy have been housing and auto sales. Ultra-low interest rates, produced in part by the Federal Reserve’s action, fueled sharp increases in sales of new and existing homes in June. Lower interest rates have also boosted auto sales, though home and auto sales remain below pre-pandemic levels.
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