U.S. adds 1.4 million new jobs, as rate falls to 8.4% in August

Nathan Sweetland. left, and Erik Rumpke work on a truck at Rose Automotive Thursday, July 9, 2020 in Hamilton. NICK GRAHAM / STAFF
Caption
Nathan Sweetland. left, and Erik Rumpke work on a truck at Rose Automotive Thursday, July 9, 2020 in Hamilton. NICK GRAHAM / STAFF

Credit: Nick Graham

Credit: Nick Graham

Economist says new data shows recovering is slowing

Still struggling to break free of the ongoing global pandemic, the national economy added or recovered 1.4 million jobs in August, with the national jobless rate falling to a better-than-expected 8.4 percent, down from 10.2% in July.

Those numbers show a recovery, but a slow one, economists said.

Hiring for the 2020 Census was part of the strengthening in government hiring, the bureau said. Job gains also happened in retail trade, in professional and business services, in leisure and hospitality, and in education and health services, the government said.

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Another area of job gains: Manufacturing employment rose by 29,000, with gains seen in the non-durable goods sector (27,000 jobs added). Despite gains in recent months, employment in manufacturing is 720,000 below February’s, level, the bureau said.

Economists expected the numbers to show that hiring had continuing in August, looking for about 1.3 million new jobs. That would have been a good month, although it would also have been the slowest pace of the recovery since March and April.

The forecast was for unemployment to fall to 9.8% in August, below 10 percent for the first time since the pandemic was first truly felt in the United States in March.

Ball State University economist Michael Hicks says the jobs report is actually “a clear indication” the recovery in fact is slowing.

“One way to think about this economic downturn is as a tall wave, followed by a storm surge,” said Hicks, director of Ball State University’s Center for Business and Economic Research. “The tall wave has passed, but the storm surge behind gains strength with each passing month. The surge is unlikely to be as tall as the initial wave, but it will be historically large and last for years.

The unemployment rate in February was 3.5%.

The economy has added back 10.6 million jobs since May, said Gus Faucher, PNC Financial chief economist. But employment nationally is still down by 11.5 million, or almost 8 percent, from that February peak.

About 29 million people were receiving some kind of state or federal assistance last month.

The nation is settling in for what likely will be a long, slow recovery. In recent months, the number of people who have been unemployed for 15 weeks or longer rose to more than 6 million.