US unemployment came in at 13.3% (from 14.7% in April) as the US added jobs in pretty much all sectors. The expectation had been for further job losses and an unemployment rate closer to 19%. Perhaps the biggest miss ever.
Now sure some funnies in the number, but they existed n the April numbers as well so net-net the miss would have happened.
But what is important is that it shows the US economy opening up and bouncing back strongly, but perspective is still needed.
Current US unemployment remains the worst numbers since the great depression with the 2008/9 financial crisis peaked at 10%.
It is a long way back to single-digit unemployment and even longer to the sub 4% from the beginning of the year.
The driver here will remain the pandemic and what we need to watch remains the rate of infections in the US with 14 states still reporting growing numbers. This could slow or even reverse the positive jobs data we saw.
My thinking is that we will likely see the US unemployment rate improve further over the next few months with 10% possible by the end of their summer (August / September). My logic here is that lockdown saw millions at home and the lifting of lockdown saw many return to work. But what we don't know is how many businesses are still in business because a bankrupt business doesn't employ anybody. So while 10% is very possible getting below that number may be a lot harder and could take years.
That all said the key point is that while nobody truly expected an improving US job situation this quickly it did happen and there is no point denying it. Instead, we adjust our expectations as expected data reveals itself. As important is to remember that while this was a massive positive number, it stills remains a massive number that shows an economy under severe pressure.
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