Unemployment rate increased slightly to 4.0 percent in January
The Bureau of Labor Statistics has released the Employment Situation report for January which showed a slight increase of 0.1 percent to 4.0 percent
According to the Bureau of Labor Statistics, Unemployment inched up slightly in January to four percent from the 3.9 percent figure recorded in December. The increase could be do to the increase in covid-19 cases from the highly transmissible Omicron variant which caused many businesses to close their doors voluntarily. However, compared to the first wave of infections in March 2020, the economy was not derailed to the same extent during the most recent surge.
While the the rate did increase, the economy still added 467,000 jobs, a number nearly three times higher than what was expected. From December to January, the number of workers experiencing unemployment held steady at 6.5 million, still higher than the 5.7 million figure seen in February 2020.
What impact did Omicron have on the labor market?
One indicator where it is easy to see the impact the Omicron variant had on the economy is tracked through the number of people "unable to work because their employer closed or lost business due to the pandemic." This figure doubled from December (3.1 million) to January (6 million). This means that 6 million people either "did not work at all or worked fewer hours at some point in the 4 weeks preceding the survey due to the pandemic."
Additionally around 1.8 million people were "prevented from looking for work due to the pandemic," in January, up from 1.1 million in December.
Which sectors saw increases in the number of jobs?
Sectors that saw the greatest job growth in January included “leisure and hospitality (+151,000), in professional and business services (+86,000), in retail trade (+61,000), and in transportation and warehousing (+54,000).” Leisure and hospitality was one of the sectors hit hardest by the pandemic. Compared to February 2020, around 1.8 million jobs are still missing or around 10.3 percent of the sector.