The economy continued to improve last month, with 379,000 new jobs and a slight downtick in the unemployment rate to 6.2 percent. Economists had been predicting about 170,000 new jobs. The vast majority of these jobs, 355,000, were in the leisure and hospitality industry, which had been hardest hit by pandemic-related closures and social distancing.
The job losses in December, as the COVID surge peaked, were worse than first reported. Job losses totaling 306,000, not 227,000. But job gains in January were revised upwards, from a measly 49,000 to 166,000, offsetting much of December’s slump.
The workforce participation rate is unchanged from January at 61.4 percent, which is still well below last February’s rate of 63.3 percent. Many people, especially women, had to drop out of the labor force when schools closed to care for children. The number of Americans not counted in the labor force is now 100,708,000. Last February it was 95,180,000. If the teachers’ unions ever allow schools to reopen, many of those extra 5 million non-workers will begin to migrate back into the job market. That could cause the unemployment rate to rise, at least temporarily, but it would also increase the participation rate.
As the viral surge diminishes, and the number of people who have been vaccinated rises quickly, we are much closer to herd immunity. An epidemiologist at Johns Hopkins estimated in the Wall Street Journal last week that we’ll get there next month. More and more states are relaxing restrictions on venues such as indoor dining, gyms, and theaters. And not just the “Neanderthal” states like Texas and Mississippi. Even blue states, such as Connecticut, are scheduled to go back to near normal rules this month.
The arrival of spring is always welcome, but that goes double for this year.