August 2020 Employment Situation Analysis
According to the Bureau of Labor Statistics Monthly Jobs report the US unemployment rate fell 1.8 %to 8.4% overall. The non-farm payroll rose by 1.4M jobs but is still down 11.5M jobs since Covid hit. The number of unemployed persons fell by 2.8M to 13.6M. The percentages and numbers of unemployed have decreased 4 consecutive months but still higher than in February 2020 by 4.9% and 7.8M respectively. The improvement in the labor market was due to resuming of economic activity after the closure of business due to Covid 19. Government hiring increased temporarily in August for the 2020 Census. There were notable gains in health services, business, and professional services as well as leisure and hospitality.
Unemployment rates declined in August for:
Adult Men-8%
Adult Women-8.4%
Teenagers-16.1%
Whites-7.3%
Blacks-13%
Hispanics-10.5%
In August, the number of permanent job losers increased by 534,000 to 3.4M, which is an increase of 2.1M since February.
The number of unemployed who were jobless:
Less than 5 weeks decreased by 921,000 to 2.3M
5 to 14 weeks decreased by 2M to 3.1M
Long term unemployment (27+ weeks) 1.6M with little change over prior month
The labor force participation increased .3% to 61.7% but still 1.7% behind where we were in February.
Total employment rose by 3.8M to 147.3M
In August, the number of people who usually work:
Full time rose 2.8M to 122.4M
Part time increased 991,000 to 25M and accounted for ¼ of the month over month growth. The number of people working part time, involuntarily due to business conditions, declined by 871,000 to 7.6M but still 3.3M higher than February.
In August 24.3% of employed workers telecommuted due to the Covid pandemic, a decrease of 2.1% from July.
24.4M workers reported that they were unable to work because their employers had closed or reduced schedules due to pandemic, a 7.1% decrease from July. 11.6% of these workers received some sort of pay from their employers.
Employment stats:
Employment in Healthcare increased 75,000 over July with gains in:
physician offices-27,000
dental-22,000
hospitals-14,000
home health-12,000 but losses in nursing homes and residential care facilities continued, -14,000
Employment in Education and health services increased by 47,000 but is still 1.5M below February level
Government job increased 344,000
Retail jobs increased 249,000
Professional and business services jobs increased 197,000, ½ attributed to temporary help
Leisure and hospitality jobs increased 174,000 with ¾ of the gain in restaurant and bar services. Despite the gain of 3.6M over the last 4 months employment in this sector is still down 2.5M since February.
Car dealer/parts jobs increased 22,000
Electronics and appliance jobs increased 21,000
Misc. retailer jobs increase 17,000 yet retail trade is still 655,000 lower than in February
Architectural and engineering jobs increased 14,000
Business support services jobs increased 13,000 yet 1.5M below February
Prior to the pandemic, many healthcare systems were focused on growth, the pandemic put a halt to many of those plans and focus has moved to the recovery phase. This will include a build-out of delivery networks. The importance of financial strength and flexibility with be an ongoing theme and the organizations that emerge from the pandemic with a strong balance sheet will be in a position to accelerate their mission. In the beginning of 2020 Healthcare employment increased overall, but due to Covid, and the reduction/elimination of elective procedures many facilities were forced to cut pay, furlough staff. When talking to our clients, we are hearing that despite the elective procedures coming back, the patients are not coming in at the previous volumes but are increasing. Critical jobs are being opened back up due to the elective procedures coming back as well as the government financial assistance (CARES Act). Some facilities are in better financial shape now that prior to the pandemic. The candidates that were seeking new positions are reluctant to make any changes because of the Covid situation.
Action steps to manage the change:
1) Consider Interim placement for immediate critical needs and new service lines, i.e. Telehealth.
2) Leverage the staff that you have currently, eliminate redundancies, many of the skills are translatable to other clinical areas, if only for a short period.
3) Evaluate service offerings and decide if they are financially viable in the long term, if cutting service lines, cross train those employees to other service lines.
4) If employees were furloughed, consider staying engaged with these workers, we project that hiring will be an issue when normalized business returns.
The full text of the BLS monthly jobs report can be found here: https://www.bls.gov/news.release/empsit.nr0.htm
