20.5M jobs lost in April, unemployment at 14.7%

Record increase of 10.3 percentage points in a month from COVID-19

An African American sits dejected on the South Side of Chicago during a recession in 1973. (EPA/John White)

By Ted Cox

The national unemployment rate approached 15 percent in April as the economy lost 20.5 million jobs in a month due to the coronavirus crisis.

In its monthly report issued Friday, the U.S. Bureau of Labor Statistics found that national unemployment rose to 14.7 percent in April, up 10.3 percentage points from March, “the highest rate and the largest over-the-month increase in the history of the series” dating back to 1948. The report concluded: “The sharp increases in these measures reflect the effects of the coronavirus pandemic and efforts to contain it.”

The report came out a day after the U.S. Department of Labor released new data showing job losses extending into May, with another 3.2 million idled workers filing unemployment claims in the week ending Saturday, making more than 33 million claims filed since the economic crisis brought on by the CoVID-19 pandemic and efforts to contain it first took hold in the United States in March.

According to Friday’s report, “unemployment rates rose sharply among all major worker groups. The rate was 13 percent for adult men, 15.5 percent for adult women, 31.9 percent for teenagers, 14.2 percent for whites, 16.7 percent for blacks, 14.5 percent for Asians, and 18.9 percent for Hispanics. The rates for all of these groups, with the exception of blacks, represent record highs.”

The was no respite to the bad news. “The labor force participation rate decreased by 2.5 percentage points over the month to 60.2 percent, the lowest rate since January 1973 (when it was 60 percent). Total employment, as measured by the household survey, fell by 22.4 million to 133.4 million. The employment-population ratio, at 51.3 percent, dropped by 8.7 percentage points over the month. This is the lowest rate and largest over-the-month decline in the history of the series.

“The number of persons who usually work full time declined by 15 million over the month, and the number who usually work part time declined by 7.4 million. Part-time workers accounted for one-third of the over-the-month employment decline.”

The reported added: “Total nonfarm payroll employment fell by 20.5 million in April, after declining by 870,000 in March. The April over-the-month decline is the largest in the history of the series and brought employment to its lowest level since February 2011 (the series dates back to 1939). Job losses in April were widespread, with the largest employment decline occurring in leisure and hospitality,” although losses were heavy across almost all sectors of the economy.

Bureau Commissioner William Beach issued an additional statement saying: “Among the unemployed, the number of people searching for work for less than five weeks was 14.3 million, an increase of 10.7 million from March. These recently unemployed people represented 61.9 percent of the unemployed in April. The number of unemployed persons who were jobless five to 14 weeks rose by 5.2 million to 7 million. The number of people searching for work for 27 weeks or more declined slightly to 939,000 over the month.”

Those looking for good news could consult a national WalletHub study finding that Illinois fared relatively well ranked against other states, but even there the losses were brutal. The study found that, year to year in April, Illinois unemployment claims rose 700 percent, from 9,320 in a week to 74,476 last week, but that was fourth lowest among the 50 states. From the beginning of the year to last week, claims jumped more than 500 percent, but that ranked more in the middle at 21st. Overall claims from the start of the pandemic economic crisis in mid-March to last week rose more than 1,500 percent from the same period last year, but that ranked eighth in the nation.

Historically, unemployment fell to a 50-year low over the winter at 3.5 percent, but rose to 4.4 percent in March as the pandemic began to affect the national economy. That had reflected a near-complete recovery from the Great Recession a decade ago, which saw unemployment rates peak just above 10 percent. The 14.7 percent rate reported Friday is the highest ever recorded since the bureau began releasing monthly reports in 1948, although it’s estimated that the rate hit 25 percent at the worst of the Great Depression in 1933.