Businesses are restarting operations and rehiring workers as shelter-in-place restrictions ease, but the current unemployment rate is still a staggering 13.3 percent.
“We’re bringing jobs back,” President Trump was quick to boast on Friday at a news conference on May’s jobs report.
Based on what—just one month’s data?
Friday’s key report showed that U.S. employers actually added 2.5 million jobs during the month of May, even though many economists were predicting job losses in the millions. That bit of unexpected news made May 2020 the best month for job growth since 1939, when the Bureau of Labor Statistics began tracking job market data. May’s report also brought down the rate of unemployment to 13.3 percent from 19.7 percent in April. But at 13.3 percent, that’s still higher than the 10 percent rate at the peak of the Great Recession in October 2009.
The good news also came a day after jobless claims for the week ended May 28 showed another decline in first-time filers, this time with just 1.88 million filing new claims for unemployment benefits. Still, the new filings bring the total number of claims to nearly 42.6 million over an 11-week period since the coronavirus pandemic arrived on U.S. shores.
Trump was quick to tweet “Really Big Jobs Report. Great Going President Trump (kidding but true)!”
At the news conference, Trump also predicted that the country will have a “very good” August and July, maybe a “spectacular” September, and a “spectacular” October—that is, a “spectacular” stretch leading up the presidential election in November. Obviously, Trump is hoping he can claim some form of economic victory in time to get himself re-elected for a second term, even if that’s only based on one month’s worth of data.
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But one month’s gain doesn’t signal that all who have lost jobs will either be rehired by their former employers or be able to find new jobs. In fact, restaurants and bars contributed the most to May’s job gains as reopenings created nearly 1.4 million jobs. So, what about fashion retailers?
Nonessential retailers temporarily shuttered their stores in mid-March as state and local governments mandated shelter-at-home restrictions to stop the spread of the virus. Most employees were furloughed, and retailers have just restarted phased-in store reopenings.
And while no one wants to negate May’s jobs data, the fact remains there are still millions more who were furloughed and don’t know yet if they have a job to return to, not to mention those who have permanently lost their jobs.
In retail this week, J.C. Penney said it will be closing 154 stores beginning next Thursday, while G-III Apparel Group decided to shutter all 110 Wilson’s Leather stores and all 89 G.H. Bass doors.