Each month, Automatic Data Processing Inc., which handles payrolls for about a fifth of U.S. private employment, releases its job report two days before the government’s Bureau of Labor Statistics announces its own findings for both private and public sector jobs. ADP reported Wednesday that non-farm private sector employment fell by 20,236,000 last month. That’s a horrendous number. But since ADP’s report only utilized data through April 12, the count doesn’t include the past three weeks’ worth of layoffs related to the COVID-19 economic lockdown. In other words, dreadful as these numbers are, they aren’t as bad as the actual job situation. And since the BLS report will also only include data up to the week in which April 12 fell, its report this week won’t give a true picture of the job market either.
Said Ahu Yildirmaz, co-head of the ADP Research Institute, “Job losses of this scale are unprecedented. The total number of job losses for the month of April alone was more than double the total jobs lost during the Great Recession.” In fact, for the past two months, the total is more than triple the total jobs lost in that economic downturn.
In the weeks since April 12, there have been 8.3 million seasonally adjusted new claims for unemployment insurance benefits, and experts project another 3.1 million new claims were filed in the week ending May 2, which will be reported Thursday. Add that estimate to the layoffs that began in earnest the third week of March and the seven-week total comes to 33.1 million.
But that jaw-dropper still doesn’t include the 1.63 million people who left the civilian labor force last month, millions of laid-off workers who aren’t eligible for unemployment benefits or for one reason or another don’t think they are, and people suddenly out of work who haven’t yet been able to complete their benefit claims. A guess would put the total layoffs for March through April at around 40 million. That would translate into an unemployment rate of around 24%, which is Great Depression territory.
The Friday BLS report, however, which covers the last half of March and the first half of April, is projected to report a loss of 21 million jobs for that period, with the unemployment rate around 16%. At the peak of the Great Recession, 10% of the U.S. labor force was officially out of work.
The ADP report also revised its count for March from a loss of 27,000 private-sector jobs to a loss of 149,000.
Of the total count, 4.23 million jobs were lost in goods-producing businesses—2.47 million in construction, and 1.67 million in manufacturing, a part of the economy that was already in trouble much of last year before the novel coronavirus made its appearance. In the service sector, 16 million people lost their jobs in the survey period, with leisure and hospitality workers taking the biggest hit, a loss of 8.7 million jobs.
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