Job growth again fell short of expectations this month, according to the latest employment report from the Bureau of Labor Statistics. Nonfarm payroll employment increased by just 194,000 jobs in September, following the addition of 235,000 jobs in August.
However, the unemployment rate continued its decline, dropping from 5.2% to 4.8% in September and bringing the total number of unemployed down to 7.7 million people. But this drop may be due, in part, to more workers leaving the labor force altogether.
Unemployment rates decrease for most major worker groups
Unemployment rates decreased for all major worker groups except teenagers in September:
- Adult men: 4.7% (5.1% in August)
- Adult women: 4.2% (4.8% in August)
- Teenagers: 11.5% (11.2% in August)
- Black/African American: 7.9% (8.8% in August)
- Hispanic/Latino: 6.3% (6.4% in August)
- Asian: 4.2% (4.6% in August)
- White: 4.2% (4.5% in August)
Unemployment situations and pandemic impacts hold steady
Both permanent and temporary layoffs changed little in September — both falling slightly to 2.3 million and 1.1 million people, respectively. Short-term unemployment (less than five weeks) remained around 2.2 million in September, while long-term unemployment (six months or more) declined by 496,000 to 2.7 million, accounting for 34.5% of the total unemployed. The labor force participation rate dropped just one percentage point to 61.6%.
The pandemic didn’t loosen its grip on employment by much in September. The percentage of employees who teleworked due to the pandemic stayed at 13.2% for the month, while those unable to work due to business closures or losses fell from 5.2 million to 5.0 million people. And there were 1.6 million people unable to look for work because of pandemic-related reasons.
Modest job gains for leisure and hospitality, losses in education
After little change in August, the leisure and hospitality industry added 74,000 jobs in September, primarily in arts, entertainment, and recreation (43,000 jobs).
Many of the other major industries had small job gains, including:
- Professional and business services (60,000)
- Retail trade (56,000)
- Transportation and warehousing (47,000)
- Information (32,000)
- Social assistance (30,000)
- Manufacturing (26,000)
Although schools around the country reopened in September, employment dropped in local (-144,000), state (-17,000), and private (-19,000) education. The healthcare industry also lost jobs, dropping by 18,000.
With schools reopened and unemployment benefits ending, economists hoped the slowdown in job growth would end this month. But September’s numbers show that, despite availability of jobs, higher wages, and incentives from employers, many Americans aren’t returning to the labor force as quickly as expected.