• Initial jobless claims fell last week for the first time in three weeks
  • The unemployment rate was down from 14.7% in April and down 0.9% from June
  • The number of unemployed fell by 1.4 million


The Labor Department reported Friday unemployment fell to 10.2% as the economy added 1.8 million jobs, fewer than the number added in the two preceding months likely due to an upsurges in coronavirus cases. The Bureau of Labor statistics credited an improving economy as pandemic restrictions were eased.

It was the lowest level since the coronavirus pandemic induced a recession in February. The Labor Department, however, admitted data collection may be flawed because of its classification methods, and some people marked as on temporary layoff should be classified as unemployed. The misclassification for June and July was believed smaller than those for previous months.

The 1.8 million jobs added last month was far fewer than the 4.8 million added in June and the 2.7 million added in May, slowing the economic recovery. The economy has regained about 40% of the jobs lost as the economy shut down in March and April.

Century Fund senior fellow Andrew Stettner said at the current rate of recovery it will take eight months to make up for the 22 million job losses resulting from the pandemic.

“While a 10.2 percent unemployment rate is severe, this traditional measure still badly underestimates the amount of Americans who have suffered a loss of work,” he said in an email to International Business Times.

“Not only has labor market distress not improved as much as hoped for, the nature of unemployment is evolving from initial temporary joblessness to more permanent layoffs.”

The most jobs were gained in the leisure and hospitality, government, retail trade, professional and business services, other services and healthcare sectors, BLS said. senior economic analyst Mark Hamrick warned, however, the gains in the hospitality and retail sectors may not be permanent.

"While bars, restaurants and retail establishments accounted for a good part of the jobs restoration reported in July, there will be a substantial number of business failures in those sectors this year. The echoes of the pandemic downturn will continue to reverberate both for individuals and enterprises for quite some time to come," Hamrick said in an email.

The number of unemployed fell by 1.4 million to 16.3 million, up 10.6 million from February when the unemployment rate was at a record low 3.5%.

Unemployment rates for adult men fell to 9.4%; for adult women, 10.5%; teenagers, 19.3%; whites, 9.2%; Asians, 12%, and Hispanics, 12.9%. The rate for Blacks remained unchanged at 14.6%.

The number of people on temporary layoff fell 1.3 million to 9.2 million, nearly half the level in April when unemployment hit 14.7%. The number of permanent layoffs was virtually unchanged from June at 2.9 million while the number of people reentering the workforce was pegged at 2.4 million. The number of people who have been jobless for 27 weeks or more was put at 1.5 million, about the same as June’s level.

The labor force participation rate was 61.4%, with 143.5 million people working.

The number of part-time workers rose by 803,000 to 24 million. Those working full time stood at 119.5 million, comparable to June’s level.

The number of people involuntarily working part time fell by 619,000 to 8.4 million as businesses added back hours. The number, however, still was 4.1 million higher than February’s level. The number of people who want a job but are not currently working fell 492,000 to 2 million.

The most jobs were added in the leisure and hospitality sector where 592,000 gained employment, accounting for nearly a third of the overall increase. The mining industry and the ancillary businesses supporting it shed 18,000 jobs.

The average workweek fell by 0.1 hour to 34.5 hours.