June Unemployment Rate Dips To 11% But More Than 1 Million Filed Initial Jobless Claims As Coronavirus Surged

The U.S. economy created 4.8 million new jobs in June, pushing the unemployment rate more than two points lower to 11.1%, but more than 1.4 million Americans filed initial claims last week as coronavirus cases mounted in states initially unscathed in the early phases of the disease, the Department of Labor reported Thursday.

The June figures, however, were collected before coronavirus began surging in more than a dozen states, forcing governors to pause or roll back reopening plans. Additionally, a statistical quirk in the way the unemployment figures are collected could mean the June rate was a full point higher.

“Employment in leisure and hospitality rose sharply in June. Notable job gains also occurred in retail trade, education and health services, other services, manufacturing, and professional and business services. Employment continued to decline in mining,” the Bureau of Labor Statistics reported.

Unemployment expert Andrew Stettner of the Century Foundation said despite the surge in hiring last month, there still are 14.6 million fewer jobs available than there were before the pandemic hit.

“The bottom line from this morning’s Labor Department reports on jobs and unemployment is clear: the country remains gripped by dual economic and public health crises, leaving far too many Americans out of work as we enter a period of increased risks due to COVID-19,” Stettner said in an email to International Business Times.

He noted 21.5% of the workforce currently is collecting unemployment benefits.

Mark Hamrick said in an email to IBTimes the economic recovery still is at risk.

“A precarious cocktail of risks sits in front of us between the continued prevalence of the virus and historically elevated unemployment,” he said. “Looking beyond the June employment data, worrisome signs have emerged in recent days regarding a pullback in store traffic and spending likely linked to the resurgence of COVID-19.”

The June jobless rate was down more than two points from May’s 13.3% rate. The number of those seeking work fell 3.2 million to 17.8 million, but the jobless rate is up 7.6 points and 12 million workers since February when unemployment was at a record low 3.5%, the BLS said.

The unemployment rate for adult men and women, teenagers, whites, Blacks and Hispanics all fell while the rate for Asians was little changed.

Temporary layoffs in June fell by 4.8 million to 10.6 million but the number of permanent job losses rose by 588,000 to 2.9 million.

The labor force participation rate rose 0.7 point to 61.5%, 1.9 points below February’s level. Total employment rose by 4.9 million to 142.2 million while the number of people not in the labor force fell by 767,000 to 8.2 million.

Full-time employment increased by 2.4 million to 118.9 million while the number of those who usually work part time rose by a like number to 23.2 million. The number of those who would prefer full-time work but were working part time fell by 1.6 million to 9.1 million.

In its weekly initial claims report, BLS said the insured unemployment rate for the week ending June 20 was unchanged at 13.2% with nearly 19.3 million people out of work, up 59,000 from the week before.

The total number of people collecting unemployment benefits for the week ending June 13 was nearly 31.5 million, up 916,722 from the previous week. That compares to 1.58 million for the comparable week in 2019.

Extended benefits were available in 48 states, with nearly 12.9 million individuals collecting Pandemic Unemployment Assistance and 794,703 claiming Pandemic Emergency Unemployment Compensation in 39 states. Both programs are set to expire July 31.

The unemployment rates for the week ending June 13 were in Puerto Rico, Nevada, Hawaii, the Virgin Island and New York.

The most claims for the week ending June 20 were filed in California, Maryland, Florida, New Jersey and Indiana while the biggest decreases were recorded in Oklahoma, Kentucky, Oregon, Georgia and New York.