Hiring snarls emerge amid US economic recovery

9 May, 2021 12:00 AM printer

WASHINGTON: With only 260,000 jobs added and the unemployment rate rising slightly to 6.1 percent, the Labor Department employment report for April was a letdown for the United States.

Here are a few reasons why hiring may have slowed last month in the world’s largest economy as it looks to recover from the mass unemployment caused by the Covid-19 pandemic:

Unemployment remains widespread in the United States where there are 8.2 million fewer jobs than in February 2020 before the pandemic hit, according to the Labor Department’s monthly report, reports AFP.

And weekly data showed nearly 16.2 million people were receiving some form of government unemployment aid as of mid-April.

Successive rescue measures passed by Congress have expanded the unemployment safety net and increased weekly benefit payments.

The Republican opposition and some businesses now say that extra aid is giving unemployed people an incentive to stay home rather than work. The US Chamber of Commerce argues that the generous pandemic unemployment benefits, including the extra $300 weekly payment provided in the rescue package passed in March, are making it hard for firms to fill open positions.

But President Joe Biden downplayed that concern, saying there was no measurable impact from the extra weekly aid.

Some states are trying to find ways to encourage people to return to the job. Montana said it will give $1,200 to unemployed workers who accept a position.

In the private sector overall, the Labor Department reported salaries increased three percent in the first quarter of this year compared to the same period in 2020.

The number of people working part-time because they could not find a full time position fell by a sharp 583,000 in April, perhaps signaling that employers prefer to increase the hours of their current employees before they hire new ones.

Schools and daycare centers remain closed or only partially operational in parts of the United States, particularly cities, even as Covid-19 case counts decline. That has forced many parents, especially women, to stay at home to look after their children, particularly those who do not have the option of working remotely.