February Labor Market Report
The U.S. Bureau of Labor Statistics just released the latest Employment Situation report containing important updates on labor market activity and employment rates. February 2021 brought modest growth in the labor market. Here are the key insights from the report:
Unemployment Rate and Job Growth
The national U.S. unemployment rate for February 2021 was 6.2%. This is only a nominal change compared to the 6.3% unemployment rate reported in January 2021. There were 10 million people unemployed in February, compared to the 10.1 million unemployed reported in January. This small improvement does show some progress, but the economic impact of covid-19 is clearly still very strong.
In February, approximately 379,000 nonfarm jobs were added. Most of these job gains occurred in the leisure and hospitality sector, an industry that was previously hit hard by the pandemic. There were also small gains in temporary help services, health care, retail, and manufacturing. Employment in state and local government education, construction, and mining declined.
Leisure and Hospitality Employment
Temporary help services saw a big increase in employment in January, and that trend continued in February. 53,000 temporary service jobs were added in February. The industry is still down by 175,000 compared to a year ago, but it is recovering more quickly than many other industries.
Many businesses are utilizing temporary workers and staffing services due to lingering uncertainty in the labor market. Many industries are seeing growth, but businesses may not be ready to pull the trigger on more permanent hiring just yet. Businesses looking to hire temporary workers should try Faveo! Finding on-demand labor for your business shouldn’t be a hassle. Faveo makes hiring short-term help easy so you can operate with flexibility and efficiency. Those looking for temporary work can also reach out to apply!.
Extreme Weather and the Labor Market
The BLS did include a note on the report regarding the severe winter storms that occurred in February. Much of the country experienced snow storms and portions experienced long-term power outages and other utility concerns. This may have had an impact on employment and hiring. It could also provide an explanation for why industries such as mining and construction saw a decline.
According to the California Employment Development Department, 3.7 million people collected unemployment in February. About one-third of these people were participating in the Pandemic Unemployment Assistance (PUA) program, a federal program for people who are not eligible for traditional state unemployment insurance benefits. This includes self-employed individuals, gig workers, and those that have run out of traditional unemployment insurance benefits.
Reopening and Labor Market Improvement
The labor market is beginning to show signs of recovery. While the growth was modest, it did occur in some hard-hit industries and would likely have been much larger without the strong adverse weather conditions. The expanded rollout of vaccines, weather improvement, and the decline in daily covid cases all point to improving labor market conditions. The road to economic recovery will be long, but progress has begun.
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