Unemployment Rate Steadies at 6.7% as December Reports Slower Job Market Recovery
In December, both the unemployment rate, at 6.7 percent, and the number of unemployed persons, at 10.7 million, were unchanged. Although both measures are much lower than their April highs, they are nearly twice their pre-pandemic levels in February. Among the major worker groups, the unemployment rates for teenagers (16.0 percent) and Hispanics (9.3 percent) increased in December. The jobless rates for adult men (6.4 percent), adult women (6.3 percent), Whites (6.0 percent), Blacks (9.9 percent), and Asians (5.9 percent) showed little change.
Among the unemployed, the number of persons on temporary layoff increased by 277,000 in December to 3.0 million. This measure is down considerably from the high of 18.0 million in April but is 2.3 million higher than in February. The number of permanent job losers declined by 348,000 to 3.4 million in December but is up by 2.1 million since February. The number of unemployed reentrants increased by 282,000 to 2.3 million over the month, 452,000 higher than in February.
The labor force participation rate and the employment-population ratio were both unchanged over the month, at 61.5 percent and 57.4 percent, respectively. These measures are up from their recent April lows but are lower than in February by 1.8 percentage points and 3.7 percentage points, respectively. In December, the number of persons not in the labor force who currently want a job, at
7.3 million, was little changed over the month but is 2.3 million higher than in February. These individuals were not counted as unemployed because they were not actively looking for work during the last 4 weeks or were unavailable to take a job.
WHAT DOES THIS MEAN FOR STAFFING?
While the slow of employment gains in December may appear concerning, to the staffing industry, which historically observes slow hiring in December, the steadiness is a sign of optimism. We did not see companies layoff additional staff to hit year-end budget targets. Companies are focusing on retention strategies and avoiding unnecessary turnover going into 2021.