It's getting better, but it's still a far cry from where it was.
That's roughly how economists and market-watchers summed up Friday's nonfarm payrolls report for August, which showed that U.S. companies added to their ranks, pushing the jobless rate below 10% for the first time since the pandemic began.
Nonfarm payrolls rose by 1.371 million last month, down from a revised 1.763 million new positions in July but below analysts' forecasts of 1.4 million, the U.S. Bureau of Labor Statistics reported on Friday. The unemployment rate fell to 8.4% from 10.2% last month, better than analysts' forecasts of a drop to 9.2%.
While an improvement from the dark days of March and April, the numbers continue to reflect historically high joblessness not seen in the United States since the Great Depression. The unemployment rate was 3.5% in February, a half-century low, just ahead of the pandemic. That swung dramatically in March and April, when nonfarm payrolls fell by a combined 21.4 million.
Indeed, while the labor market has shown improvement over the past two months amid re-hiring in leisure and hospitality and other sectors, the economy is still out some 11.4 million jobs since March.
"I don't think enough consideration has been made to the math showing real GDP would've been contracting (a seasonally adjusted) 10% in the third quarter, if not for the lagged effects of Uncle Sam's generosity this spring," wrote Rosenberg Research founder and chief economist David Rosenberg.
"The U.S. economy remains on life support. Markets may not care, but that is the grim reality."
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