Unemployment rate drops to 13.3 percent
‘Limited resumption of economic activity’ in May regains 2.5 million jobs
The national unemployment rate dropped in May, driven by a recovery in leisure and hospitality, as with this recently reopened Illinois restaurant offering outdoor dining. (Facebook/Illinois Restaurant Association)
By Ted Cox
Defying economic analysts, the U.S. unemployment rate actually dropped in May, driven by a “limited resumption of economic activity” as the national economy began to reopen in the COVID-19 pandemic.
The U.S. Bureau of Labor Statistics reported that the unemployment rate declined from 14.7 percent in April to 13.3 percent last month. Although economic experts had expected the rate to continue to increase to as high as 20 percent, after millions more U.S. workers filed for unemployment benefits throughout May, the bureau reported total nonfarm payrolls actually gained 2.5 million jobs, driven by sharp rises in “leisure and hospitality, construction, education and health services, and retail trade.”
The report claimed the number of unemployed workers actually declined 2.1 million to 21 million total.
Even so, the unemployment rate was up 9.8 percentage points since reaching a 50-year low of 3.5 percent in February, “due to the coronavirus (COVID-19) pandemic and efforts to contain it,” with 15.2 million workers losing their jobs.
One sign of the effect of state economies reopening from stay-at-home orders was that “the number of unemployed persons who were on temporary layoff decreased by 2.7 million in May to 15.3 million, following a sharp increase of 16.2 million in April.” The report added, however, that “among those not on temporary layoff, the number of permanent job losers continued to rise, increasing by 295,000 in May to 2.3 million.”
The bureau reported: “The unemployment rates declined in May for adult men (11.6 percent), adult women (13.9 percent), whites (12.4 percent), and Hispanics (17.6 percent). The jobless rates for teenagers (29.9 percent), blacks (16.8 percent), and Asians (15 percent) showed little change over the month.”
Just last Friday, drawing on U.S. Bureau of Labor Statistics data from April, the Illinois Department of Employment Security reported that “the number of nonfarm jobs decreased over-the-year in April in all 14 Illinois metropolitan areas, with six metro areas at record low payrolls” since 1990, when the methodology changed.
Overall, the state unemployment rate was set at 16.9 percent in April, up 13.3 percentage points from 3.6 percent the year before. The worst losses were reported in Rockford, which saw its unemployment rate rise 17.9 percentage points to 22.4 percent, and in the Chicago-Naperville-Arlington Heights area, which rose 14.1 points to 17.6 percent. Peoria and Carbondale-Merion both saw 13.7-point increases, to 17.8 and 17.1 percent.
College towns weathered the economic shutdown stemming from the pandemic best, with Champaign-Urbana reporting a 7.6-point increase to 10.9 percent and Bloomington-Normal a 9.5-point increase to 12.8 percent. Even so, the department emphasized that “the unemployment rate increased over-the-year in all metro areas to record highs for the month of April as the COVID-19 pandemic continued to impact local areas across the state.”
Deputy Gov. Dan Hynes used the report to renew calls for federal COVID-19 relief to address revenues lost in the pandemic, issuing a statement saying: “With every corner of our nation impacted by the COVID-19 pandemic, it is time for the federal government to provide state and local governments with additional relief. Our administration is focused on helping small businesses rebuild and ensuring working families recover as communities across the state begin safely reopening their economies next week.”
The state will see how well the national rebound in May extended to Illinois when that local data is processed and released later this month.