In April 2020, the number of open vacancies in the United States (one of the main indicators of the US labor market) fell by 965 thousand compared to March and reached 5 million. The value was the lowest since March 2015. On Tuesday, June 9, the Federal Bureau of Labor Statistics of the United States.

As noted in the department, the main cause of the negative dynamics were the consequences of the COVID-19 pandemic. To date, the United States remains the leader in the number of coronavirus infected. At the same time, quarantine restrictions introduced in early spring provoked a massive reduction in trade and passenger traffic, as well as the closure of companies and industries.

According to experts, the American labor market was in the most difficult situation in April. Then the unemployment rate in the country for the first time since 1940 rose to 14.7%.

Meanwhile, in early June, the US Department of Labor announced a slight decrease in unemployment in May to 13.3%. According to experts, some improvement in dynamics in the last month of spring could be associated with a gradual weakening of quarantine measures.

“In many states, companies and enterprises have begun to reopen. Accordingly, people began to return to work, and the number of jobs increased slightly, ”said Alexander Abramov, head of the laboratory of the Institute of Applied Economic Research of the RANEPA, in a conversation with RT.

At the same time, despite the emerging positive, the US Ministry of Labor admitted that the last three months mistakenly did not take into account all unemployed citizens. As a result, the ministry’s experts explained that in recounting the unemployment rate in the country in May may not be 13.3%, but 16.3%.  

“Many workers were categorized as employed but not at work. As in March and April, when conducting a family survey, it was necessary to classify employed people who were absent from work due to the closure of firms due to the coronavirus epidemic as temporarily laid off unemployed. However, it is obvious that not all workers who meet these criteria have been assigned to this category. The US Federal Bureau of Labor Statistics and the Census Bureau are finding out why this classification error still occurs, ”the agency’s report said.

Note that the last time unemployment in the United States exceeded 16% in 1939. Such data are provided by the Federal Reserve Bank of St. Louis.

“The occurrence of an error may be due to statistical disorder: too large differences in numbers from month to month. US departments do not process incoming requests well because they are not used to working with large volumes of unemployment data, ”Alexander Abramov explained.

  • © Carlos Barria / Reuters

According to the US Department of Labor, in the spring the number of new applications for unemployment benefits in the country grew by more than 43 million. The value began to increase sharply since mid-March, and the weekly growth rate of the indicator was the highest for the entire time of observation.

“Many Americans complained that the employment services could not cope with such a flood of applications, and for weeks they could not register as unemployed. In April alone, the number of unemployed increased by 20 million. For the US, these are just crazy numbers, ”said Finam Group analyst Alexei Korenev.

In addition, the occurrence of errors in labor statistics can be associated with a political factor. This point of view in a conversation with RT was expressed by an expert at the International Institute for Humanitarian and Political Studies Vladimir Bruter.

“Having received disappointing figures, analysts probably decided to use a different method and simply excluded some of the people from the statistical data. A similar game with numbers may be associated with the upcoming US presidential election. The rating of Donald Trump has seriously shaken over the past couple of months amid a pandemic and a wave of protests, so politics needs good news to attract more voters. As a result, with the help of such “mistakes”, the presidential administration is trying to smooth out the negative news background, ”Bruter suggested.

Own laws

According to Alexei Korenev, partly the situation in the American employment sector was aggravated by the peculiarities of the country's labor legislation. So, workers in the country are practically not protected from dismissals.

“There are no paid vacations there. Moreover, the legislation is tougher even for maternity leave: they are given not for three years, as we have, but only for a few days. Employers can quickly dismiss employees, but as soon as the business starts to come back to life and people start quarantining, horrific numbers can start to recover quickly, ”Korenev explained.  

However, according to Alexander Abrmov, before the end of the year, unemployment growth in the country may again accelerate. In his opinion, the second wave of coronavirus is at risk of becoming one of the main factors in the worsening dynamics.

“After the improvement of the unemployment situation, one should not be hopeful that in the coming months everything will be cloudless. In some states, the number of cases has fallen, but a second wave of a pandemic is also possible. The process of recovery and job creation may slow down as a result. Markets and American politicians were too optimistic about the May figures, but they still do not mean a turning point in the trend, ”Abramov concluded.