By Editorial of The New York Sun
The sudden plunge in the unemployment rate just reported for May is a reminder of — for all setbacks of the past few months — the extraordinary power of the Trump economy and the American free enterprise system. The economy added 2.5 million jobs last month, bringing the jobless rate down to 13.3% from the 14.7% recorded in April. Given that expectations were running closer to 20%, or more, it’s just a remarkable report.
US economy adds 2.5 million jobs in May, unemployment falls to 13.3%
By Noah Manskar and Thornton McEnery
The US mounted a surprise recovery from the coronavirus crisis by adding a record 2.5 million jobs last month, the feds said Friday, stunning experts who predicted more bloodletting in the labor market.
The Bureau of Labor Statistics’ monthly jobs report showed the unemployment rate falling to 13.3 percent as states began to lift virus-related lockdowns. That’s an improvement from April’s 14.7 percent unemployment although it is still higher than any other point since the Great Depression.
The data suggest the government’s efforts to backstop the economy during the pandemic have helped kickstart a recovery, blindsiding economists who predicted millions more lost jobs and unemployment at or near 20 percent.
“The difference was that more people got hired back than expected,” explained George Pearkes, macro strategist at Bespoke Investment Group. “That’s down to PPP and the natural occurrence of businesses reopening. The correlation between the two is very key.”
Several industries added jobs last month, but restaurants and bars devastated by pandemic lockdowns led the way with 1.4 million positions, accounting for about half of the total gain, the feds said. The construction and retail sectors also saw sharp increases, adding 464,000 and 368,000 jobs, respectively, the feds said.
“The sectors that got a lot of PPP loans — construction, retail, restaurants — that’s where we saw a lot of the job gains in May,” Curt Long, chief economist and vice president of research at the National Association of Federally-Insured Credit Unions, told The Post. “With the prospect of reopening now a reality, or it looks like it could be a reality for people in the near future, it now makes sense for a lot of those people to rehire workers back.”
The Trump administration crowed about the report, saying it showed the economy is making a strong recovery from the coronavirus. President Trump tweeted that the numbers were “stupendous” and “INCREDIBLE!”
“It appears the worst of the coronavirus’s impact on the nation’s job markets is behind us,” US Labor Secretary Eugene Scalia said in a statement.