A recent report by MarketWatch has found that the U.S. regained 49,000 jobs in January and the unemployment rate fell again, but the report stated that the economy is still struggling to recover from the COVID-related layoffs at the end of 2020.
Marketwatch said the low numbers “added fuel to Democratic demands for another large dose of federal aid to help the economy.” The Biden administration is seeking approximately $2 trillion from Congress, including $1,400 payments for most families.
The report also found that the U.S. had lost jobs again in December for the first time since the start of the pandemic, and with reimposed business restrictions the service industry had to lay off workers, some for the second or third time.
Meanwhile, the report found that the unemployment rate fell to 6.3 percent in January from 6.7 percent, an apparent pandemic low, but Marketwatch said the decline stemmed “largely from people abandoning job searches and thereby dropping out of the labor force.”
“We especially shouldn’t take solace that the unemployment rate fell dramatically given that’s mainly because more Americans dropped out of the labor force,” said Robert Frick, corporate economist at Navy Federal Credit Union to MarketWatch.
“Economists say the true level of joblessness is several points higher,” the report said. “A big reason is that several million people who dropped out of the labor force because they couldn’t find work aren’t counted in the main unemployment rate.”
Read the full report here.