President Donald Trump touted the record job gains in June Thursday, saying the U.S. was “roaring back” as the economy attempts to crawl out of a crater left by the coronavirus pandemic.
“This is the largest monthly jobs gain in the history of our country,” Trump said in a press conference Thursday morning following the Labor Department’s monthly U.S. employment report.
“Today’s announcement proves that our economy is roaring back,” Trump said, adding that the government’s response to the pandemic was “working out very well.”
The monthly job gains in May and June are historic, but the labor market is still facing a net loss of 14.7 million job losses from the coronavirus recession.
About 2.7 million jobs were added in May and 4.8 million positions were added in June — both a record. However, they came after an unprecedented 22.2 million job losses in March and April.
Economists and analysts anticipate that the job figures will be volatile until a vaccine for the virus is developed.
“It remains too difficult to call this trend with any real confidence as we continue to see-saw between lockdown tightening and lockdown loosening,” Shane Balkham, chief investment officer at discretionary fund manager Beaufort Investment, said in a note. “Instead, it’s the revision to these numbers in the next set of data that will prove most revealing.”
The further reopening of the economy in June ushered back more temporarily laid off workers. The job gains were concentrated in industries that have been hammered by the pandemic, including leisure and hospitality, health care and retail.
Service-sector employment rose to 4.2 million in June, building upon the 2.5 million rebound in May. However, the two-month rebound of 6.8 million jobs only recovers 36% of the positions lost in March and April, according to Oxford Economics.
The number of permanent job losses in June continued to climb, rising by 588,000 to nearly 2.9 million.
Economists have attributed the burst in job gains to the government’s Paycheck Protection Program that provided small businesses loans that cover eight weeks of wages and other expenses. But the exhaustion of those loans threatens to lead to another wave of layoffs, economists caution.
The data was collected in mid-June before a recent surge in virus cases. And layoffs have remained high since then as more states across the U.S. have paused plans to reopen following a resurgence in cases, forcing more business to shutter.
The closures, along with patrons being unwilling to return to close-quarter establishments, may weigh on the payrolls numbers in July, Peter Essele, head of portfolio management at investment advisor Commonwealth Financial Network, said in a note.
Separate data released Thursday showed about 1.43 million workers filed first-time claims for unemployment insurance last week, the Labor Department said, with more than 48 million Americans seeking initial jobless benefits in just 15 weeks. The total of those receiving benefits for consecutive weeks turned higher last week, rising by 59,000 to 19.29 million.
Last week, initial claims for state unemployment benefits jumped by 24,033 in Indiana. In Washington and Virginia, claims rose by 8,110 and 7,769, respectively. And Kentucky saw benefits spike by 5,600. Claims in Oklahoma, however, dropped by 41,933 while Maryland fell by 10,620.
“As long as there is no final resolution of the pandemic, the economy might face a prolonged situation of moving back and forth in terms of lockdown measures,” Christian Scherrmann, U.S. economist at asset manager DWS Group, said in a note. “It is likely some businesses will not survive such a bumpy ride.”