Total U.S. unemployment reached 13.3% in May, falling from 14.7% the month before, an improvement that stunned pundits, who had expected a further deterioration, and is a shot of optimism for a battered economy.
Stock surged on the news. The DJIA was up a hefty 870 points, or 3.3%, in mid-afternoon trade. Showbiz stocks were exuberant, outpacing the broader market led by exhibitors, cable and broadcast companies, media congloms and live event operators.
The Labor Department said Friday morning the improvement reflected a limited resumption of economic activity that had been curtailed in March and April due to the coronavirus pandemic and efforts to contain it.
Total nonfarm payroll employment rose by 2.5 million in May, while experts on average had been expecting job losses of at least 8 milllion.
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Job losses have caused widespread misery and raised tensions in states and cities, pitting health advocates and public officials afraid of spreading the coronavirus against distressed business owners and workers.
Minorities have been the hardest hit by joblessness. A demographic breakdown in today’s announcement showed gains unevenly distributed. The improvement in May most benefitted white people, where May unemployment fell to 12.4% (11.6% for men and 13.9% for women). It declined for Hispanic people as well but that rate was still a high 17.6%. And unemployment for blacks, at 16.8%, showed little change over the month.
May employment rose most sharply in leisure and hospitality, construction, education and health services, and retail. The DOL doesn’t break out media and entertainment, where job losses have been widespread as movie theatres and theme parks were closed and film and TV production shut down. The industry — from live sports to filming, theaters and parks — is looking to cautiously start repopening later this month and next with extensive COVID-19-related modifications and in close collaboration with state and local authorities.
Household survey datat shows the number of unemployed people fell by 2.1 million to 21 million. The number of unemployed people is still up by 9.8 percentage points and 15.2 million, respectively, since February.
Widespread shutdowns caused by the pandemic started in mid-March. In May, the number of unemployed people who were jobless less than 5 weeks decreased by 10.4 million to 3.9 million. or 18.5% of the unemployed. The number of unemployed who were jobless 5 to 14 weeks rose by 7.8 million to 14.8 million, repping 70.8%, or the bulk, of the unemployed.
The number of long-term unemployed (those jobless for 27 weeks or more), at 1.2 million, increased by 225,000 over the month and represented 5.6% of the unemployed.
May employment in leisure and hospitality increased by 1.2 million, following massive losses of 7.5 million in April and 743,000 in March.
Employment in food services and drinking places rose by 1.4 million, accounting for about half of the gain in total nonfarm employment. May’s gain in food services and drinking places followed steep declines in April and March (-6.1 million combined).
In contrast, employment in the accommodation industry fell in May (-148,000) and has declined by 1.1 million since February.
These montly figures, compiled by the DOL’s Bureau of Labor Statistics based on surveys done mid-month of households and businesses, are separate from weekly reports of newly filed unemployment claims that are released each Thursday for the previous week.
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