The good news is, the U.S. economy continues to add new jobs and slowly recover from the brutal losses from earlier this year. The bad news is, we still have a long way to go.
The Bureau of Labor Statistics released its report for August this morning.
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.
There are elements of progress in the data. It's good, for example, to see the unemployment rate drop below 10% for the first time in several months. What's more, the 1,371,000 jobs added -- BLS rounded up in its description of 1.4 million -- is slightly better than projections headed into this morning.
But there are also discouraging signs. For example, we're nowhere close to recovering from the job losses from March and April, and we've seen slowing gains in each of the last few months. What's more, we're seeing increases in the number of permanent job losses -- as compared to temporary crisis layoffs.
It's also worth noting that nearly a quarter of a million of the jobs included in the August tally were the result of temporary Census Bureau hiring.
As we discussed last month, the point is not that 1.37 million jobs is some kind of disaster. It's not. Rather, the trouble is the depth of the hole we're in after the job losses from the spring, and the challenge of climbing back to where we were.
This is an economy that could use a boost from Congress and the White House, but with Republicans showing little interest in a meaningful compromise, the prospects for a new aid package appear poor.
As for the image above, the chart shows GDP numbers by quarter since the Great Recession began. The red columns show the economy under the Bush and Trump administrations; the blue columns show the economy under the Obama administration.