New unemployment figures indicate that businesses in the US shed far fewer jobs than anticipated last month – only 2.76 million losses, where 9.3 million had been expected.
While the economy has seen a combined 22.6 million jobs disappear since March, nearly 20 million of those layoffs occurred in April.
As the states make plans to start slowly reopening their economies at various rates – with many of them planning to return to near-normal in the coming weeks – hopes are building that at least some of the job losses could be mitigated sooner than initially feared.
Mark Zandi, chief economist at Moody’s Analytics, told reporters that barring a second wave of the outbreak and with some additional government support, the Covid-19 recession appears to have only lasted three months.
“It will be the shortest recession on record, but it will be among the most severe,” he said.
The recent damage was concentrated in two sectors: manufacturing, which cut 719,000 jobs in May, and the trade, transportation and utilities sector, which let go of 826,000 people.
Other sectors that suffered as part of April’s 19.6 million job losses saw their layoffs slow sharply. The leisure and hospitality industry – which includes hotels and restaurants – shed 105,000 jobs last month, down from a revised 7.7 million losses in April.
The private industry report comes two days ahead of the official monthly job figures from the US Labor Department. Economists expect the Friday report will show 8 million job losses in May as the unemployment rate approaches 20%.
Donald Trump has made much of the need to get the economy back to form, betting that by allowing businesses to reopen after months of social distancing he will head into the November election with much of the damage repaired.
He has even said he does not intend to close the US again if a second wave of infection begins, insisting that should the virus return it will be in the form of small, localised outbreaks that can easily be “put out”.
With Associated Press
