The non-farm workforce rose only 245,000 in November, well below Wall Street estimates as rising coronavirus cases came with a significant slowdown in hiring.
Economists polled by Dow Jones had searched for 440,000 and the unemployment rate was set to fall to 6.7% from 6.9% in October.
The unemployment rate was in line with expectations, but together with a decline in the employment rate it fell to 61.5%. A broader measure of unemployment fell to 12% while the number of Americans outside the workforce is just over 100 million.
The November profit was a significant slowdown from the 610,000 positions added in October.
Overall, the economy brought back 12.3 million of the 22 million jobs lost in the first two months of the crisis. There are still 10.7 million Americans listed as unemployed, compared to 5.8 million in February.
The total number of permanent job losers remained at 3.7 million in November but increased 2.5 million from February.
At the pace added in November, the economy would not return to pre-pandemic employment until 2024, according to Daniel Zhao, chief economist at Glassdoor employment agency.
“Today’s report is a firm reminder that we are not out of the woods yet,” said Zhao. “Even with a vaccine on the horizon, many are preparing for a long winter.”
November’s job gains would be considered strong under normal circumstances, but the pandemic has left millions of Americans jobless due to jobs lost in the early stages of the crisis. The grand total represents the slowest job growth since the employment recovery began in May, as the number of unemployed workers for at least 25 weeks rose 11% to nearly 4 million.
“Overall, it’s a disappointing report,” Jefferies economists said in a note. “As COVID cases rise again and policies are put in place to slow the spread, hiring has slowed. Labor availability is also a major limiting factor as many are absent from work due to COVID concerns or family care can commitments. “
Despite the disappointing number, markets showed little reaction and Wall Street expected a higher opening.
The increases in jobs resulted from transportation and storage, which increased by 145,000 thanks to an increase in couriers and messengers and warehousing and storage.
Professional and business services added 60,000 and health care increased 46,000. The battered hotel industry, which suffered the worst job loss during the pandemic, only rose 31,000 while the retail sector lost 35,000 jobs, a potentially worrying sign of the holiday shopping season.
General merchandise stores fell by 21,000 while sporting goods, hobbies, books and music stores fell by 12,000. Electronics and home appliances stores declined 11,000 while health and personal care products stores declined 8,000.
Overall, retail was down 550,000 employees from February, the month before the pandemic restrictions went into effect.
Construction and manufacturing each created 27,000 jobs during the month, while financial activities rose by 15,000.
Government recruitment fell for the third straight month, declining by 99,000, largely due to the loss of census workers hired for the 2020 census.
The numbers come amid a new surge in coronavirus cases that threatens to marginalize the U.S. healthcare system. More than 100,000 people are being hospitalized in the U.S. due to the accelerated outbreak, which saw 210,161 new cases on Thursday, according to the COVID Tracking Project, which is being monitored by journalists in the Atlantic.
Despite the U.S. having its fastest growing quarter ever, economists fear the next quarter or two could see flat or even negative growth before bouncing off sharply in late 2021.
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