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Unemployment Numbers Continues to Be Affected by Pandemic in January

-Editorial

The unemployment rate fell by 0.4 percentage point to 6.3 percent in January, while nonfarm payroll employment changed little (+49,000), the U.S. Bureau of Labor Statistics reported today. 

The labor market continued to reflect the impact of the coronavirus (COVID-19) pandemic and efforts to contain it. In January, notable job gains in professional and business services and in both public and private education were offset by losses in leisure and hospitality, in retail trade, in health care, and transportation and warehousing.

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. 

Household Survey Data

In January, the unemployment rate fell by 0.4 percentage point to 6.3 percent, and the number of unemployed persons decreased to 10.1 million. Although both measures are much lower than their April 2020 highs, they remain well above their pre-pandemic levels in February 2020 (3.5 percent and 5.7 million, respectively). 

Among the major worker groups, the unemployment rates declined over the month for adult men (6.0 percent), adult women (6.0 percent), Whites (5.7 percent), and Hispanics (8.6 percent). The jobless rates changed little for teenagers (14.8 percent), Blacks (9.2 percent), and Asians (6.6 percent). 

Among the unemployed, the number of persons on temporary layoff decreased in January to 2.7 million. This measure is down considerably from the recent high of 18.0 million in April but is 2.0 million higher than its February level. The number of permanent job losers, at 3.5 million, changed little in January but is 2.2 million higher than in February. The number of reentrants to the labor force decreased in January to 2.0 million. (Reentrants are persons who previously worked but were not in the labor force before beginning their job search.)

In January, the number of persons jobless less than 5 weeks decreased to 2.3 million. The number of long-term unemployed (those jobless for 27 weeks or more), at 4.0 million, was about unchanged in January and accounted for 39.5 percent of the total unemployed. 

After accounting for the annual adjustments to the population controls, both the civilian labor force and the number of employed persons changed little in January. At 61.4 percent, the labor force participation rate was about unchanged over the month but is 1.9 percentage points lower than its February level. The employment-population ratio, at 57.5 percent in January, changed little over the month but is 3.6 percentage points lower than in February. 

The number of persons employed part-time for economic reasons, at 6.0 million, changed little in January. This measure is 1.6 million higher than the February level.

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.

The number of persons not in the labor force who currently want a job, at 7.0 million, edged down in January but is 1.9 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. 

The number of persons marginally attached to the labor force, at 1.9 million, decreased in January. These individuals wanted and were available for work and had looked for a job sometime in the prior 12 months but had not looked for work in the 4 weeks preceding the survey. The number of discouraged workers, a subset of the marginally attached who believed that no jobs were available for them, was little changed over the month at 624,000.

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