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World

US Unemployment Rate for April Disappoints

Martin Burns

May 7, 2021

World

US Unemployment Rate for April Disappoints

Martin Burns

May 7, 2021

Photo by Toomas Tartes

US unemployment numbers failed to budge in April. Economists have predicted that the rate would fall to 5.8% from March's 6% number, and that 975,000 jobs would be added, after adding 916,000 in March, and that the unemployment rate slipped from 6% to 5.8%.

Instead, today's report shows an unemployment rate stuck at 6.1%, adding only 266,000 new roles. While leisure and hospitality roles increased notably, declines in temporary help and couriers impacted what should have been a positive report.

  • The unemployment rates for adult men (6.1 percent), adult women (5.6 percent), teenagers (12.3 percent), Whites (5.3 percent), Blacks (9.7 percent), Asians (5.7 percent), and Hispanics (7.9 percent) showed little or no change.
  • The number of people on temporary layoff remained unchanged at 2.1 million.
  • The number of permanent job losers, at 3.5 million, was also little changed over the month.
  • The number of persons jobless less than 5 weeks increased by 237,000 to 2.4 million.
  • The number of persons jobless 15 to 26 weeks declined by 188,000 to 1.2 million.
  • The number of long-term unemployed (those jobless for 27 weeks or more), at 4.2 million, was essentially unchanged in April.
  • These long-term unemployed accounted for 43.0 percent of the total unemployed in April.
  • The number of persons not in the labor force who currently want a job was 6.6 million, little changed over the month.

People are returning to the office. In April, 18.3 percent of employed persons teleworked because of the coronavirus pandemic, down from 21.0 percent in the prior month. These data refer to employed persons who teleworked or worked at home for pay at some point in the last 4 weeks specifically because of the pandemic.

In April, employment in leisure and hospitality increased by 331,000, as pandemic-related restrictions continued to ease in many parts of the country. More than half of the increase was in food services and drinking places (+187,000). Although leisure and hospitality has added 5.4 million jobs over the year, employment in the industry is down by 2.8 million, or 16.8 percent, since February 2020.

Despite these gains, they lag behind expectations as employers struggle to find workers for their open roles, The economic rebound has been so fast that many businesses, particularly in the hard-hit hospitality sector have not been able to build pipelines of candidates. Some unemployed people have also been reluctant to look for work because they fear catching the virus, while others have entered new occupations rather than return to their old jobs. And many women, especially working mothers, have had to leave the workforce to care for children.

Wages and benefits have increased during the first quarter, as employers competed for talent. The number of open jobs is well-above above pre-pandemic levels, while the size of the labor force remains smaller, at 4 million people.

Employers will likely continue to struggle to find talent, suggesting a longer slog towards recovery than had been expected.

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Gains fall short of expectations amidst a struggle to find workers for open roles
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