What to watch on work day: As the number of COVID-19 cases decreases, employment growth in October is expected to improve slightly
In the past few months, the comeback of the Delta variable clearly shows that the ebb and flow of the pandemic continues to have a powerful impact on the labor market. After an average of more than 1 million jobs were added in June and July, average employment growth in August and September slowed to less than 300,000. Although the number of COVID-19 cases has slowed between September and October, it is still higher than the levels of June and July, which suggests that when the latest employment data is released on Friday, we will see a modest improvement rather than A huge windfall.
For the reference week of October employment data, the average daily number of COVID-19 cases is 78,987Compared to the average daily number of COVID-19 cases during the September reference week, this is a significant (43.5%) improvement: 139,920. Other things being equal, this should translate into economic growth, because workers begin to feel that it is safer to resume face-to-face job search and employment, and consumers are more willing to purchase face-to-face services. However, the decline in the number of COVID-19 cases in October does not mean that we are back to the levels we had earlier in the summer. The October level was more than twice the average daily caseload (33,711 cases) during the reference week in July.
Similarly, Open table It shows that the number of restaurant customers improved slightly between the reference weeks of September and October. Compared with the same period in 2019, the number of people dining at seats dropped by 12.6% in September, but the number of people dining in October fell by 8.4%. Although the seat reduction of 8.4% relative to the pre-pandemic period is lower than what we saw in September, it is still not as small as the 5.7% drop in the reference week of July compared to July 2019. This may mean that the labor market in October did not see the kind of growth we experienced in June or July, but it may be an improvement from the disappointing September level.
In addition to the highest employment growth data, I will also pay close attention to whether all population groups have experienced employment growth, especially those that continue to lag behind in the recovery process. As inflation remains high, nominal wage growth may also cause concern. Since unemployment in the pandemic is concentrated on low-wage workers working in the service industry, I expect the growth of average wages to slow down as they re-employ them. The fact that this has not happened may indicate that many of the most vulnerable groups have not yet found a firm foothold in the recovery.
The spread of the Delta variable this summer has obviously slowed the pace of the very rapid employment recovery. This once again highlights that public health measures to contain the virus are the most important economic policy measures that can be taken. The public health barriers that have hindered employment recovery in recent months and the disappearance of the financial relief passed earlier this year also show that Passing the “Rebuild Better Act” can greatly promote employment growth In the next year or more.