In October 2020, the US added a total of 150,000 payroll jobs, according to the Bureau of Labor Statistics. This figure fell short of analyst predictions, who expected an increase of around 650,000 jobs.
The modest job growth was mainly down to a decline in government hiring and slowing hiring momentum overall. The leisure and hospitality sector posted its biggest increase since May, with the reopening of dining, entertainment and other businesses.
Meanwhile, the jobless rate dropped to 6.9 percent, its lowest level since the pandemic began. However, many of these gains are attributable to large reductions in the number of workers actively looking for jobs, rather than to increased hiring.
The coronavirus pandemic has been a huge blow to the US economy, and the labor market is still struggling to recover from its effects. The number of payroll jobs is still 7.6 million less than it was before the crisis.
Millions of Americans are still relying on unemployment benefits. Many of these benefits are set to expire at the end of the year, which could push up the jobless rate once again.
According to analysts, the latest payroll figures indicate that the US economy is still a long way from reaching its pre-pandemic level. The recovery is likely to be slow and uneven, and depends heavily on the course of the virus.
While a recovery in the labor market has been underway since April, this latest payroll figure suggest that the jobs market may be weakening again. This could have significant implications for both businesses and households, as the holiday season approaches and stimulus measures remain limited.
Ultimately, the jobless rate will remain a key indicator of the US economic recovery. Further government action may be necessary to support businesses and protect jobs in the coming months.