The December jobs report out this morning from the Bureau of Labor Statistics reflects the consequences of the surge in COVID cases the country has been experiencing since the fall. The surge is undoubtedly due to the colder weather, which has caused people to be indoors much more and where the overwhelming percentage of cases are contracted.
While the rate of unemployment stayed the same as in November, 6.7 percent, the number of jobs decreased by 140,000, the first time that has happened since April. Most of these job losses, not surprisingly, are in leisure and hospitality, as states shut down indoor and even outdoor dining and imposed curfews on bars and restaurants. Jobs in that sector declined by 498,000 last month. These losses were partially offset by gains in construction, financial services, and retail trade.
The number of people on temporary layoff increased last month by 277,000 to a total of 3 million, a tiny fraction of the 18 million who were temporarily laid off in April of last year. The number of people who were permanent job losers last month, however, declined by 348,000 from the November figure to 3.4 million. But that is much higher than the 2.1 million from last February.
As the vaccines now available are more and more widely distributed, the number of new cases of COVID will inevitably decline, perhaps sharply, and state governors will open up their economies more and more. The American economy that had been roaring along until the arrival of the pandemic will return to something close to the status quo ante.
But don’t take my word for it. The stock market, the classic leading economic indicator, has been soaring since the vaccines were first authorized for distribution.