Oxford Economics still expects the economy to add 1 million jobs a month over the summer and a record 8 million in 2021 as unemployment falls to 4.3% by the end of the year.
Last month, the number of Americans on temporary layoff fell by 291,000 to 1.8 million as many restaurants and other business brought back furloughed workers. The figure is down from 18 million in the early days of the pandemic. About 20% of unemployed workers said they were on temporary layoff, down slightly from the previous month. That means many workers could still be brought back to their old jobs.
The ranks of Americans permanently laid off fell by 295,000 to 3.2 million. Even more encouraging, the number of people unemployed six months or longer fell by 431,000 to a still elevated 3.8 million-- the second largest decline on record. That suggests employers struggling to find workers are hiring the long-term unemployed, a development that could limit the pandemic's long-term economic damage if it continues. Traditionally, many companies have been reluctant to bring on the chronically jobless on concerns that their skills have eroded or that other employers have rejected them
There were other signs that hiring perked up in May. The number of employees working reached the highest level since the start of the pandemic, according to Homebase, which provides employee scheduling software to small businesses. And initial jobless claims, a gauge of layoffs, averaged 505,000 a week last month, down from 656,000 in April, a Goldman Sachs analysis shows.
Even some recent college graduates, who faced especially difficult job searches through most of the pandemic, are finding a more welcoming labor market.
Keeley White, who lives in the Chicago area, graduated a year ago with sociology and graphic design degrees and a 4.0 grade point average. But after three interviews for a job as a consumer experience researcher – who helps businesses create customer-friendly interfaces – a prospective employer told her it was freezing all hiring as the health crisis upended the economy in March 2020.
College grads struggle to find work during COVID
“It was maddening,” says White, 23, noting she felt particularly bad for her immigrant parents who look forward to her becoming the first in her family to graduate from college. “I was absolutely kind of heartbroken.”
Realizing that few firms were hiring, White spent $13,000 of her savings on a 12-week boot camp in user experience research only to face repeated rejection when she graduated in November and sent out 43 applications. She realized she was competing against hundreds of experienced researchers who had been laid off during the crisis.
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