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Delta Variant Concerns Affecting U.S. Employment Situation

September 3, 2021 by Victoria Turner
A Walgreens sign is displayed outside the store in Wheeling, Ill. (AP Photo/Nam Y. Huh)

WASHINGTON — The U.S. employment grew by 235,000 jobs and the unemployment rate declined to 5.2% in August, but that 0.2% decrease still leaves 8.4 million Americans unemployed. The 235,000 growth spurt highlighted in the Labor Department’s August Employment Situation Summary is far less than the months of June and July, where jobs increased by 962,000 and 1.1 million respectively. 

In a statement, House Speaker Nancy Pelosi said,“Today’s job report is further evidence [that] as the delta variant continues, decisive action is needed to ensure that the economic gains forged under President Biden – including four million jobs created – are sustained and shared by all.”

Non-farm employment has been on the rise adding 17 million jobs since the early stages of the pandemic and its economic crisis. Nevertheless, it still remains at 5.3 million less than its pre-pandemic levels in February of last year. 

According to the report, the number of individuals outside of the labor force who want a job but are not actively seeking one in the four weeks leading up to the report declined by 835,000. However, the 5.7 million that remain is 700,000 more than those in February 2020 and the number of discouraged workers – those who don’t believe there is a job out there for them – dropped 115,000 from July to 392,000. 

The participation rate in the labor force, those employed or actively looking for work, experienced a mild increase from 61.4% in June to 61.7% last month.

Despite the number of temporary laid-off workers last month remaining relatively the same, it is important to note that it “is down considerably” from its April 2020 high of 18 million. The permanently unemployed and long-term unemployed numbers both dipped – 443,000 and 246,000, respectively – but remain higher by 1.2 million and 2.1 million, respectively, than their pre-pandemic levels. The report shows 5.6 million people reporting an inability to work in August due to pandemic-related closure or business loss, but that is only up 400,000 from the previous month. 

The white-collar sector is still swinging upward as seen in the prior report. Professional and business services experienced another increase of 74,000, primarily in the architectural and engineering services accounting for 19,000 of these jobs. The transportation and warehousing sector also experienced a 53,000 job uptick, putting the industry 22,000 over its February 2020 levels. 

Couriers and messengers made up most of the spike, along with warehousing and storage, with both experiencing 20,000 increases. It looks like people are still traveling despite the variant concerns, with the air transportation industry adding 11,000 jobs. However, transit and ground passengers experienced a decrease of 8,000 – and this also includes school buses, which could seem surprising at the start of the academic year. 

The private education sector was highlighted in the report with its 40,000 new hires, reflecting the same bump as the prior month. As opposed to July’s upward path, however, state government education and local government education respectively declined by 21,000 and 6,000 jobs. 

On a brighter note for those looking for a job, the report states that the increased demand for workers due to the pandemic-related labor shortage has “put upward pressure on wages” with the average private hourly earnings rising by 17 cents last month. 

The Bureau of Labor Statistics had revised its June and July employment months, noting that there were 134,000 jobs more than reported in those two months combined. 

Speaking shortly after the August jobs numbers were released, President Biden said, “There’s no question the delta variant is why today’s job report isn’t stronger.

“I know people were looking, and I was hoping for a higher number. But next week I’ll lay out the next steps we’re going to need to combat the delta variant to address some of those fears and concerns,” he said.

Biden stressed that in order to keep the economic recovery from getting derailed it is critical that the pandemic be kept under control and that Congress pass the pending $1.2 trillion bipartisan infrastructure bill that already made it through the Senate, as well as a multi-trillion dollar reconciliation package that contains other White House priorities including health care reform and climate policy.

Biden said he would outline next week how schools and businesses could blunt the effects of the delta variant, which has led U.S. infections to surge in a number of states.

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