U.S. May jobs report by the BLS reported the highest month-over-month increase ever recorded, after April’s historic job loss due to Covid-19 lockdowns. While we still need to wait until July/August to see the full impacts and revisions, preliminary data suggests businesses are roaring back to life after staggered reopenings began in early May.
Total nonfarm payroll employment rose by 2.5 million in May and the unemployment rate declined to 13.3%. These improvements in the labor market reflected a limited resumption of economic activity that had been curtailed in March and April due to the coronavirus (COVID-19) pandemic and efforts to contain it. In May, employment rose sharply in leisure and hospitality, construction, education and health services, and retail trade.
Employment in Leisure & Hospitality increased by 1.2 million or 49.4% of the total employment increase, following losses of 7.5 million in April and 743,000 in March. Construction employment increased by 464,000 in May, 18.5% of total employment increases, gaining back almost half of April’s decline (-995,000). Employment increased by 424,000, or 16.9% of total, in Education & Health Services, after a decrease of 2.6 million in April. Healthcare employment increased by 312,000 over-the-month, with gains in offices of dentists (+245,000), offices of other health practitioners (+73,000) and offices of physicians (+51,000) and fueled in large part on the lifting of restrictions for non-essential surgeries. Manufacturing employment rose by 225,000 or 9% of total, with gains about evenly split between the durable and nondurable goods components. Full breakdown of employment changes by industry super-sector follows:
The region accounts for 12% of total US nonfarm employment. Since 2018, Arizona/Texas/Utah combined have averaged 18% of total US nonfarm job growth. Assuming this trend continues, employment for the region should increase by 451,620. Contingent upon the MSA, total nonfarm employment has been reduced to late 2017, early 2018 levels.
**Assuming this rate of growth is maintained, coupled with less restrictive lockdowns the region generally witnessed, employment recovery for the region will take between 1.5 to 2.5 years to return to employment levels witnessed at the end of 2019.**