September 4, 2020  REACTIONS  |  last month's report

Bureau of Labor Statistics reports the unemployment rate in August decreased to 8.4%


Year		 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
2010 9.8 9.8 9.9 9.9 9.6 9.4 9.4 9.5 9.5 9.4 9.8 9.3
2011 9.1 9.0 9.0 9.1 9.0 9.1 9.0 9.0 9.0 8.8 8.6 8.5
2012 8.3 8.3 8.2 8.2 8.2 8.2 8.2 8.1 7.8 7.8 7.7 7.9
2013 8.0 7.7 7.5 7.6 7.5 7.5 7.3 7.2 7.2 7.2 6.9 6.7
2014 6.6 6.7 6.7 6.2 6.3 6.1 6.2 6.1 5.9 5.7 5.8 5.6
2015 5.7 5.5 5.4 5.4 5.6 5.3 5.2 5.1 5.0 5.0 5.1 5.0
2016 4.9 4.9 5.0 5.0 4.8 4.9 4.8 4.9 5.0 4.9 4.7 4.7
2017 4.7 4.6 4.4 4.4 4.4 4.3 4.3 4.4 4.2 4.1 4.2 4.1
2018 4.1 4.1 4.0 4.0 3.8 4.0 3.8 3.8 3.7 3.8 3.7 3.9
2019 4.0 3.8 3.8 3.6 3.6 3.7 3.7 3.7 3.5 3.6 3.5 3.5
2020 3.6 3.5 4.4 14.7
13.3
 11.1 10.2
8.4
       
Chart: Reprinted from U.S. Bureau of Labor Statistics https://data.bls.gov/timeseries/LNS14000000


THE EMPLOYMENT SITUATION -- AUGUST 2020

Total nonfarm payroll employment rose by 1.4 million in August, and the unemployment rate fell to
8.4 percent, the U.S. Bureau of Labor Statistics reported today. These improvements in the labor
market reflect the continued resumption of economic activity that had been curtailed due to the
coronavirus (COVID-19) pandemic and efforts to contain it. In August, an increase in government
employment largely reflected temporary hiring for the 2020 Census. Notable job gains also
occurred in retail trade, in professional and business services, in leisure and hospitality, and
in education and health services.

This news release presents statistics from two monthly surveys. The household survey measures
labor force status, including unemployment, by demographic characteristics. The establishment
survey measures nonfarm employment, hours, and earnings by industry. For more information about the concepts and statistical methodology used in these two surveys, see the Technical Note.

Household Survey Data
 
In August, the unemployment rate declined by 1.8 percentage points to 8.4 percent, and the number of unemployed persons fell by 2.8 million to 13.6 million. Both measures have declined for 4 consecutive months but are higher than in February, by 4.9 percentage points and 7.8 million,
respectively. (See table A-1. For more information about how the household survey and its
measures were affected by the coronavirus pandemic, see the box note at the end of this news
release.)

Among the major worker groups, the unemployment rates declined in August for adult men (8.0
percent), adult women (8.4 percent), teenagers (16.1 percent), Whites (7.3 percent), Blacks (13.0
percent), and Hispanics (10.5 percent). The jobless rate for Asians (10.7 percent) changed
little over the month. (See tables A-1, A-2, and A-3.)

Among the unemployed, the number of persons on temporary layoff decreased by 3.1 million in
August to 6.2 million, down considerably from the series high of 18.1 million in April. In August,
the number of permanent job losers increased by 534,000 to 3.4 million; this measure has risen by
2.1 million since February. The number of unemployed reentrants to the labor force declined by
263,000 to 2.1 million. (Reentrants are persons who previously worked but were not in the labor
force prior to beginning their job search.) (See table A-11.)

The number of unemployed persons who were jobless less than 5 weeks decreased by 921,000 to 2.3 million in August, and the number of persons jobless 5 to 14 weeks fell by 2.0 million to 3.1
million. The long-term unemployed (those jobless for 27 weeks or more) numbered 1.6 million,
little changed over the month. (See table A-12.)

The labor force participation rate increased by 0.3 percentage point to 61.7 percent in August
but is 1.7 percentage points below its February level. Total employment, as measured by the
household survey, rose by 3.8 million in August to 147.3 million. The employment-population ratio
rose by 1.4 percentage points to 56.5 percent but is 4.6 percentage points lower than in
February. (See table A-1.)

In August, the number of persons who usually work full time rose by 2.8 million to 122.4 million,
and the number who usually work part time increased by 991,000 to 25.0 million. Part-time
workers accounted for about one-fourth of the over-the-month employment gain. (See table A-9.)

The number of persons employed part time for economic reasons (sometimes referred to as
involuntary part-time workers) declined by 871,000 to 7.6 million in August, reflecting a decrease
in the number of people who worked part time due to slack work or business conditions (-1.1
million). The number of involuntary part-time workers is 3.3 million higher than in February.
These individuals, who would have preferred full-time employment, were working part time because their hours had been reduced or they were unable to find full-time jobs. This group includes persons who usually work full time and persons who usually work part time. (See table A-8.)

In August, the number of persons not in the labor force who currently want a job declined by
747,000 to 7.0 million; this measure is 2.0 million higher than in February. These individuals
were not counted as unemployed because they were not actively looking for work during the last 4
weeks or were unavailable to take a job. (See table A-1.)

Among those not in the labor force who currently want a job, the number of persons marginally
attached to the labor force, at 2.1 million, changed little in August. These individuals had not
actively looked for work in the 4 weeks preceding the survey but wanted a job, were available
for work, and had looked for a job sometime in the prior 12 months. The number of discouraged
workers, a subset of the marginally attached who believed that no jobs were available for them,
decreased by 130,000 in August to 535,000. (See Summary table A.)

Household Survey Supplemental Data

In August, 24.3 percent of employed persons teleworked because of the coronavirus pandemic, down from 26.4 percent in July. 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 coronavirus pandemic.

In August, 24.2 million persons reported that they had been unable to work because their
employer closed or lost business due to the pandemic--that is, they did not work at all or
worked fewer hours at some point in the last 4 weeks due to the pandemic. This measure is down
from 31.3 million in July. Among those who reported in August that they were unable to work
because of pandemic-related closures or lost business, 11.6 percent received at least some pay
from their employer for the hours not worked. 

About 5.2 million persons not in the labor force in August were prevented from looking for work
due to the pandemic. This is down from 6.5 million in July. (To be counted as unemployed, by
definition, individuals must either be actively looking for work or on temporary layoff.)

These supplemental data come from questions added to the household survey beginning in May to
help gauge the effects of the coronavirus pandemic on the labor market. The data are not
seasonally adjusted. Tables with estimates from the supplemental questions for all months are
available online at www.bls.gov/cps/effects-of-the-coronavirus-covid-19-pandemic.htm.

Establishment Survey Data

Total nonfarm payroll employment rose by 1.4 million in August, following increases of larger
magnitude in the prior 3 months. In August, nonfarm employment was below its February level by
11.5 million, or 7.6 percent. Government employment rose in August, largely reflecting temporary
hiring for the 2020 Census. Notable job gains also occurred in retail trade, in professional and
business services, in leisure and hospitality, and in education and health services. (See table
B-1. For more information about how the establishment survey and its measures were affected by
the coronavirus pandemic, see the box note at the end of this news release.)

Employment in government increased by 344,000 in August, accounting for one-fourth of the over-
the-month gain in total nonfarm employment. A job gain in federal government (+251,000) reflected
the hiring of 238,000 temporary 2020 Census workers. Local government employment rose by 95,000 over the month. Overall, government employment is 831,000 below its February level.

Retail trade added 249,000 jobs in August, with almost half the growth occurring in general
merchandise stores (+116,000). Notable gains also occurred in motor vehicle and parts dealers
(+22,000), electronics and appliance stores (+21,000), and miscellaneous store retailers
(+17,000). Employment in retail trade is 655,000 lower than in February.

In August, employment in professional and business services increased by 197,000. More than half of the gain occurred in temporary help services (+107,000). Architectural and engineering
services (+14,000), business support services (+13,000), and computer systems design and related services (+13,000) also added jobs over the month. Employment in professional and business  services is 1.5 million below its February level.

Employment in leisure and hospitality increased by 174,000 in August, with about three-fourths
of the gain occurring in food services and drinking places (+134,000). Despite job gains
totaling 3.6 million over the last 4 months, employment in food services and drinking places is
down by 2.5 million since February.

In August, employment in education and health services increased by 147,000 but is 1.5 million
below February's level. Health care employment increased by 75,000 over the month, with gains in
offices of physicians (+27,000), offices of dentists (+22,000), hospitals (+14,000), and home
health care services (+12,000). Elsewhere in health care, job losses continued in nursing and
residential care facilities (-14,000). Employment in private education rose by 57,000 over the
month.

Employment in transportation and warehousing rose by 78,000 in August, with gains in warehousing and storage (+34,000), transit and ground passenger transportation (+11,000), and truck  transportation (+10,000). Employment in transportation and warehousing is down by 381,000 since February.

The other services industry added 74,000 jobs in August, reflecting gains in membership
associations and organizations (+31,000), repair and maintenance (+29,000), and personal and
laundry services (+14,000). Employment in other services is 531,000 lower than in February.

Financial activities added 36,000 jobs in August, with most of the growth in real estate and
rental and leasing (+23,000). Employment in financial activities is down by 191,000 since
February.

In August, manufacturing employment rose by 29,000, with gains concentrated in the nondurable
goods component (+27,000). Despite gains in recent months, employment in manufacturing is
720,000 below February's level.

Employment in wholesale trade increased by 14,000 in August, reflecting an increase of 9,000
in the nondurable goods component. Wholesale trade employment has declined by 328,000 since
February.

In August, employment changed little in mining, construction, and information.

In August, average hourly earnings for all employees on private nonfarm payrolls rose by 11
cents to $29.47. Average hourly earnings of private-sector production and nonsupervisory
employees increased by 18 cents to $24.81, following a decrease of 10 cents in the prior month.
The large employment fluctuations over the past several months--especially in industries with
lower-paid workers--complicate the analysis of recent trends in average hourly earnings. (See
tables B-3 and B-8.)

The average workweek for all employees on private nonfarm payrolls increased by 0.1 hour to
34.6 hours in August. In manufacturing, the workweek rose by 0.3 hour to 40.0 hours, and
overtime increased by 0.1 hour to 3.0 hours. The average workweek for production and
nonsupervisory employees on private nonfarm payrolls was unchanged at 34.0 hours. (See tables
B-2 and B-7.)

The change in total nonfarm payroll employment for June was revised down by 10,000, from
+4,791,000 to +4,781,000, and the change for July was revised down by 29,000, from +1,763,000
to +1,734,000. With these revisions, employment in June and July combined was 39,000 less than
previously reported. (Monthly revisions result from additional reports received from businesses
and government agencies since the last published estimates and from the recalculation of
seasonal factors.)

_____________
The Employment Situation for September is scheduled to be released on Friday, October 2, 2020,
at 8:30 a.m. (ET).


 _______________________________________________________________________________________________
|                                             
|     Coronavirus (COVID-19) Impact on August 2020 Establishment and Household Survey Data     
|                                             
| Data collection for both surveys was affected by the coronavirus (COVID-19) pandemic. In the 
| establishment survey, approximately one-fifth of the establishments are assigned to four    
| regional data collection centers for collection. Although these centers were closed,        
| interviewers at these centers worked remotely to collect data by telephone. Additionally, BLS
| encouraged businesses to report electronically. The collection rate for the establishment    
| survey was 77 percent in August, higher than the average for the 12 months ending in February
| 2020. The household survey is generally conducted through in-person and telephone interviews.
| However, for the safety of both interviewers and respondents, the vast majority of interviews
| were done by telephone, with in-person interviews conducted on a limited basis in some areas 
| of the country. The household survey response rate was 70 percent in August, up from the low 
| of 65 percent in June but well below the average rate of 83 percent for the 12 months prior  
| to the pandemic.                                        
|                                              
| In the establishment survey, workers who are paid by their employer for all or any part of    
| the pay period including the 12th of the month are counted as employed, even if they were not
| actually at their jobs. Workers who are temporarily or permanently absent from their jobs and
| are not being paid are not counted as employed, even if they are continuing to receive    
| benefits.                                          
|                                             
| In the household survey, individuals are classified as employed, unemployed, or not in the   
| labor force based on their answers to a series of questions about their activities during the
| survey reference week (August 9th through August 15th). Workers who indicate they were not  
| working during the entire survey reference week and expect to be recalled to their jobs   
| should be classified as unemployed on temporary layoff. As in recent months, a large number   
| of persons were classified as unemployed on temporary layoff in August.            
|                                               
| Since March, household survey interviewers have been instructed to classify employed persons 
| absent from work due to temporary, coronavirus-related business closures or cutbacks as   
| unemployed on temporary layoff. BLS and Census Bureau analyses of the underlying data
| suggest there still may be some workers affected by the pandemic who should have been
| classified as unemployed on temporary layoff. However, the share of responses that may have been misclassified was much smaller in July and August than in prior months.           
|                                            
| For March through July, BLS published an estimate of what the unemployment rate would have    
| been had misclassified workers been included. Repeating this same approach, the overall    
| August unemployment rate would have been 0.7 percentage point higher than reported.
|
| However, this represents the upper bound of our estimate of misclassification and probably
| overstates the size of the misclassification error.                        
|                                             
| According to usual practice, the data from the household survey are accepted as recorded. To 
| maintain data integrity, no ad hoc actions are taken to reclassify survey responses.       
|                                           
| More information is available at                                 |
| www.bls.gov/covid19/employment-situation-covid19-faq-august-2020.htm.          
|______________________________________________________________________________|


REACTIONS


Donald J. Trump for President
September 4, 2020

PRESIDENT TRUMP DEFIES EXPERTS WITH STUNNING JOBS REPORT

The Federal Reserve predicted that unemployment would only fall to 9.3% by the end of the year. The CBO predicted unemployment would hover at 16% in the third quarter. Even Joe Biden laughed off the suggestion that the economy would bounce back anytime soon. Yet President Trump’s economic leadership has defied the experts yet again: 1.4 million jobs were created in August and the unemployment rate fell “dramatically” to 8.4%, the second-largest one-month decrease in American history.

It’s now undeniable that President Trump’s stewardship of the economy is delivering incredible results. Under President Trump’s leadership, the economy has added back an amazing 10.6 million jobs over the past four months – nearly half of all of the jobs lost due to the global coronavirus pandemic from China. Unemployment fell for all groups of Americans, including Hispanics, Black Americans, women, and veterans. Even former Obama-Biden economic advisor Jason Furman admitted this morning that the unemployment rate is now “lower even than I thought it would be at the end of the year.”

With every stellar jobs report, it becomes increasingly clear that Joe Biden has no idea what he is talking about. After presiding over eight years of the worst economic recovery since the Great Depression, he’s proposing even more radical left-wing policies that will stall America’s economic comeback. Biden said he would shut down the economy again, despite mounting evidence that Americans can both be safe and get back to work at the same time. Biden would cripple the recovery by raising taxes on the middle class, instituting crushing mandates on small businesses, and killing jobs with a radical War on American-Made Energy.

President Trump is the only candidate who will America on the path back to economic prosperity. He built the best economy in American history once before, and now he is doing it again.

Donald J. Trump for President, Inc.
September 4, 2020

JOBS, JOBS, JOBS

As Americans go back to work in record numbers, voters should ask: why would anyone allow Joe Biden – who oversaw the slowest “recovery” since the Great Depression – to spoil it?

Key Takeaways:
  • The economy added back an incredible 1.4 million jobs in August, the fourth highest one-month job gain in U.S. history
  • In total, the economy has added back 10.6 million jobs over the last four months, nearly half of all the jobs lost due to the pandemic
  • The unemployment rate fell to 8.4 percent, seeing the second-largest one month decrease in U.S. history
  • President Trump’s efforts to protect American workers and businesses during the coronavirus epidemic have clearly worked
  • Experts have consistently and wrongly said such a quick recovery would not happen
  • The Congressional Budget Office projected the unemployment rate would be 16 percent right now, and that unemployment wouldn’t fall below 9.5 percent even in 2021
  • The American economy is coming back strong, with today’s jobs numbers being the latest good news
  • Weekly jobless claims are trending downwards, beating expectations and falling to their lowest level since mid-March
  • American manufacturing has grown for four straight months
  • The stock market has rebounded, with the S&P 500 and the Nasdaq both achieving new record highs
  • Retail sales have increased three months in a row

  • President Trump has built the strongest economy in U.S. history, and he will do it again
  • Joe Biden would be the worst person to put in charge of the economy, having presided over the worst recovery since the Great Depression as Vice President
  • The economy has recovered 48 percent of the jobs lost due to the coronavirus in the last four months; during Biden’s “recovery,” it took 27 months to do the same
  • The 1.4 million jobs added in August is more than twice as many in the best month of Biden’s “recovery”

THE ECONOMY IS BOUNCING BACK SWIFTLY

1.4 Million Jobs Were Added Back In August

Nonfarm Payroll Increased By 1.4 Million In August. (Bureau Of Labor Statistics, Accessed 9/4/20)

Nonfarm Payroll For Women Increased By 800,000 In August. (Bureau Of Labor Statistics, Accessed 9/4/20)

The Economy Added 29,000 Manufacturing Jobs, 16,000 Construction Jobs, 248,900 Retail Jobs, And 174,000 Hospitality And Leisure Jobs.  (Bureau Of Labor Statistics, Accessed 9/4/20; Bureau Of Labor Statistics, Accessed 9/4/20; Bureau Of Labor Statistics, Accessed 9/4/20; Bureau Of Labor Statistics, Accessed 9/4/20)

In Total, The Economy Has Added Back 10.6 Million Jobs Back Over The Last Four Months. (Bureau Of Labor Statistics, Accessed 9/4/20)

48 Percent Of All Jobs Lost Due To The Coronavirus Have Been Added Back In The Last Four Months. (Bureau Of Labor Statistics, Accessed 9/4/20)

The Number Of Unemployed Americans Dropped By 2.8 Million In August, The Second Largest One-Month Decrease In U.S. History. (Bureau Of Labor Statistics, Accessed 9/4/20; Bureau Of Labor Statistics, Accessed 9/4/20)

Unemployment Fell Across The Board
The Unemployment Rate Decreased From 10.2 Percent To 8.4 Percent In August. (Bureau Of Labor Statistics, Accessed 9/4/20)

The Unemployment Rates For Adult Women, Black Americans, Hispanic Americans, Asian Americans, And Veterans All Fell. (Bureau Of Labor Statistics, Accessed 9/4/20; Bureau Of Labor Statistics, Accessed 9/4/20; Bureau Of Labor Statistics, Accessed 9/4/20; Bureau Of Labor Statistics, Accessed 9/4/20; Bureau Of Labor Statistics, Accessed 9/4/20)

The Great American Comeback, Better Than The Biden “Recovery”
In The Last Four Months, 48 Percent Of The Jobs Lost During The Pandemic Have Now Been Recovered. (Bureau Of Labor Statistics, Accessed 9/4/20)

It Took 27 Months For The Same Percentage Of Jobs To Return During The Biden-Led “Recovery.” (Bureau Of Labor Statistics, Accessed 9/4/20)

The 1.4 Million Jobs Added Back In August Is 2.5 Times As Large As The Best Month Of Jobs Gains During The Biden “Recovery.” (Bureau Of Labor Statistics, Accessed 9/4/20)

The Trump Administration’s Actions Have Protected American Businesses And Workers
The Paycheck Protection Program Has Provided $525 Billion To Over 5.2 Million U.S. Businesses, Protecting A Total Of More Than 51 Million Jobs. (“Paycheck Protection Program (PPP) Report,”  U.S. Small Business Administration, 8/8/20; “Paycheck Protection Program (PPP) Report,” Small Business Administration, 6/30/20)

The IRS Has Issued A Total Of $265 Billion In Coronavirus Relief Payments To 158 Million Americans. (News Release, “Treasury, IRS Deliver 89.5 Million Economic Impact Payments In First Three Weeks, Release State-By-State Economic Impact Payment Figures,” IRS, 7/17/20)  

THE ECONOMY IS REBOUNDING TOWARDS PRE-PANDEMIC LEVELS
Weekly Jobless Claims Continues To Fall, Beating Expectations
New Filings For U.S. Jobless Claims Was 881,000 For The Last Week In August Which Was “Better Than Estimates.” “New filings for jobless claims totaled 881,000 last week, better than estimates as the employment market continued its gradual progress during the coronavirus pandemic recovery.” (Jeff Cox, “Weekly Jobless Claims Total 881,000, Better Than Expected As Labor Market Continues To Heal,” CNBC, 9/3/20)

New Unemployment Benefits Are At Its Lowest Level Since Mid-March, Before The Pandemic. “The number of new applications for unemployment benefits dipped to 881,000 last week, the Labor Department reported Thursday in an encouraging sign for the economy. Forecasters had projected 950,000 new jobless claims. Instead, claims fell to the lowest level since mid-March, before the pandemic induced mass layoffs.” (Jay Heflin, “New Jobless Claims Fall To Lowest Level Since Mid-March,” Washington Examiner, 9/3/20)

Jobless Claims Has Been Trending Downward Over The Past Several Months. “The total number of Americans receiving unemployment benefits fell sharply for the week ended July 25, down more than 3 million to 28.26 million, also pointing to a downward trend in joblessness. A year ago, that number was 1.7 million.”  (Jeff Cox, “U.S. Weekly Jobless Claims Fall To 963,000, First Time Below 1 Million Since Mid-March,” CNBC, 8/13/20)

Manufacturing Has Grown For Four Straight Months
Manufacturing Grew In August According To The Institute Of Supply Management’s Manufacturing Index. “Economic activity in the manufacturing sector grew in August, with the overall economy notching a fourth consecutive month of growth, say the nation’s supply executives in the latest Manufacturing ISM® Report On Business®. The report was issued today by Timothy R. Fiore, CPSM, C.P.M., Chair of the Institute for Supply Management® (ISM®) Manufacturing Business Survey Committee: ‘The August PMI® registered 56 percent, up 1.8 percentage points from the July reading of 54.2 percent.” (Press Release, “PMI at 56.0%; August 2020 Manufacturing ISM Report On Business,” Institute For Supply Management, 9/1/20)

Manufacturing Activity In August Reached A 19 Month-High. “The Institute for Supply Management (ISM) said on Tuesday its index of national factory activity increased to a reading of 56.0 last month from 54.2 in July. That was the highest level since January 2019 and marked three straight months of growth.” (Luci Mutikani, “U.S. Manufacturing Activity At 19-Month High In August,” Reuters, 9/1/20)

The Stock Market Has Rebounded
In August, The S&P 500 Closed At A Record High, “Capping A Remarkable Rebound” And Marking “The Index’s Fastest-Ever Recovery From A Bear Market.” “The S&P 500 closed at its highest level ever Tuesday, capping a remarkable rebound fueled by unprecedented government stimulus and optimism among investors about the world’s ability to manage the coronavirus pandemic. … The whole chapter, from peak-to-peak, spanned just 126 trading days and marks the index’s fastest-ever recovery from a bear market.”  (Michael Wursthorn, “S&P 500 Sets First Record Since February, Erasing Its Coronavirus Plunge,” The Wall Street Journal, 8/18/20)

Earlier This Week, The Nasdaq Achieved A New Record High. (Sinead Carew, “S&P, Nasdaq Close At Record Highs In Tech-Fueled Rally,” Reuters, 9/1/20)

Consumer Spending Has Rebounded To Pre-Pandemic Levels
In July, Consumer Spending Rose 1.9 Percent. “Consumer spending, which accounts for more than two-thirds of U.S. economic activity, rose 1.9% last month, after jumping 6.2% in June.”  (Lucia Mutikani, “U.S. Consumer Spending Rises Strongly; Outlook Uncertain As Fiscal Stimulus Fades,” Reuters, 8/28/20)

“U.S. Consumer Spending Increased More Than Expected In July, Boosting Expectations For A Sharp Rebound In Economic Growth In The Third Quarter…” (Lucia Mutikani, “U.S. Consumer Spending Rises Strongly; Outlook Uncertain As Fiscal Stimulus Fades,” Reuters, 8/28/20)

Spending On Goods “Has Rebounded Above Its Pre-Pandemic Level.” “Consumers boosted purchases of goods like new motor vehicles. They also lifted spending on healthcare, dining out and hotel and motel accommodation. While spending on goods has rebounded above its pre-pandemic level, outlays on services are about 9.7% from recovery as consumers remain wary of exposure to the coronavirus.” (Lucia Mutikani, “U.S. Consumer Spending Rises Strongly; Outlook Uncertain As Fiscal Stimulus Fades,” Reuters, 8/28/20)

Retail Sales Have Increased Three Months In A Row
In July, Retail Sales Increased By 1.2 Percent Marking Three Straight Months Of Increased Sales. “U.S. households boosted retail spending 1.2% in July, the third straight monthly increase despite a rise in coronavirus infections, the Commerce Department reported Friday. Retail sales—covering spending at service stations, restaurants, stores, and online—grew briskly in May and June.”  (Josh Mitchell and Suzanne Kapner, “US July Retail Sales Rose 1.2%,” Fox Business, 8/14/20)

Sharp Growth In The Housing Market
Housing Starts In July Rose 22.6 Percent, A Sign Of Growth As Permits Rose “Sharply” For Both Single- And Multifamily Dwellings. “Investors Tuesday brushed aside worries about the nation’s continuing struggle to contain the pandemic, focusing instead on signs of strength in the housing and retail sectors. Housing starts in July rose 22.6 percent to a seasonally adjusted annual rate of nearly 1.5 million, the Commerce Department said. Permits also rose sharply for both single- and multifamily dwellings.” (Hamza Shaban and David Lynch, “U.S. Stocks Hit Record High, Ending Shortest Bear Market In History,” The Washington Post, 8/18/20)

EXPERTS SAID A COMEBACK THIS QUICK WOULDN’T HAPPEN
In April, The Congressional Budget Office (CBO) Projected That The Unemployment Rate For 2021 Would Be 10.1 Percent, And That It Would Only Decrease To 9.5 Percent By The End Of 2021. “The labor market is expected to improve after the third quarter, with a rebound in hiring and a significant reduction in furloughs as the degree of social distancing diminishes—leading to an increase in business activity and an increase in the demand for workers. In particular, the unemployment rate is projected to decline to 9.5 percent by the end of 2021. Under that projection, the unemployment rate at the end of 2021 would be about 6 percentage points higher than the rate in CBO’s economic projection produced in January 2020, and the labor force would have about 6 million fewer people.” (Phill Swagel, “CBO’s Current Projections Of Output, Employment, And Interest Rates And A Preliminary Look At Federal Deficits For 2020 And 2021,” Congressional Budget Office, 4/24/20)


In July 2020, JPMorgan Estimated That Unemployment Would Not Fall Below 10.9 Percent By The End Of 2020. “Economists at the bank now peg their base-case scenario for unemployment at the end of 2020 at 10.9%, up from a prediction of 6.6% when it reported first-quarter earnings. That dimmed outlook comes as earlier-than-expected rehiring during May and June still left 20 million out of work, and as business reopenings are being rolled back in some regions.” (Lisa Bellfuss, “What JPMorgan’s Earnings Outlook Says About The U.S. Economy. Hint: It’s Not Great,” Barron’s, 7/15/20)

JPMorgan Predicted Unemployment Would Still Hover Around 8 Percent “At The End Of 2021.” “More interesting is where JPMorgan sees the U.S. economy at the end of 2021. Unemployment will still hover around 8%, the bank says, and GDP will still contract—a call that contrasts with many other Wall Street firms expecting a return to growth next year.” (Lisa Bellfuss, “What JPMorgan’s Earnings Outlook Says About The U.S. Economy. Hint: It’s Not Great,” Barron’s, 7/15/20)

In May 2020, Goldman Sachs Expected The Unemployment Rate To Be 10 Percent At The End Of 2020 And Above 8 Percent At The End Of 2021. “Goldman Sachs expects the unemployment rate to stand around 10% at the end of 2020. For context, that matches the worst levels of the Great Recession. And even by the end of 2021, Goldman Sachs sees unemployment above 8%.” (Matt Egan, “Goldman Sachs Issues Warning About US Unemployment,” CNN, 5/13/20)

In June 2020, The Federal Reserve Predicted Unemployment Would Only Fall To 9.3 Percent By The End Of 2020. “Federal Reserve leaders predict a slow recovery for the U.S. economy, with unemployment falling to 9.3 percent by the end of this year and to 6.5 percent by the end of 2021, after tens of millions of Americans lost their jobs in the stunning recession caused by the outbreak of the novel coronavirus.” (Heather Long, “Federal Reserve Predicts Slow Recovery With Unemployment At 9.3 Percent By End Of 2020,” The Washington Post, 6/10/20; “June 10, 2020: FOMC Projections Materials, Accessible Version,” U.S. Federal Reserve, 6/10/20)

Economists, As Compiled By Bloomberg, Expected An Unemployment Rate Of 9.8 Percent In August. “The US economy added back a greater than expected number of payrolls in August and the unemployment rate improved by a larger than anticipated margin, as employers continued to bring back workers as virus-related business disruptions abated. Still, the pace of payroll gains slowed relative to recent months. Here were the main metrics from the Department of Labor’s August jobs report released Friday morning, compared to consensus estimates compiled by Bloomberg: Change in non-farm payrolls: +1.371 million vs. +1.350 million expected, vs. +1.734 million in July; Unemployment rate: 8.4% vs. 9.8% expected, vs. 10.2% in July; Average hourly earnings, month over month: 0.4% vs. 0.0% expected, +0.1% in July; Average hourly earnings, year over year: 4.7% vs. 4.4% expected, 4.7% in July; Labor force participation rate: 61.7% vs. 61.8% expected, 61.4% in July.”  (Emily McCormick, “Jobs report: US economy adds 1.371 million payrolls in August, unemployment rate dips to 8.4%,” Yahoo Finance, 9/4/20)


Remarks as Prepared for Delivery by Vice President Joe Biden in Wilmington, Delaware