“R.itemList.length” “- this.config.text.ariaShown
“This.config.text.ariaFermé”
By Lucia Mutikani
WASHINGTON (Reuters) – The expansion of tasks in the United States is likely to slow, particularly in July, amid a resurgence of new COVID-19 infections, providing clearer evidence to date that the recovery of the economy from the pandemic recession is weakening.
On Friday, the Department of Labor’s heavily monitored employment report could put pressure on the White House and Congress to speed up negotiations on the aid program. Discussions led to differences in primary issues, adding the amount of government benefits to tens of millions of unemployed.
A weekly supplement of $600 to get unemployment benefits expired last Friday, while thousands of companies were burned down thanks to government-filed loans to pay wages.
A relapse in the hard-working market would be additional bad news for President Donald Trump, who is lagging behind in opinion polls for former Vice President Joe Biden, the presumptive Democratic Party candidate for the November 3 election.
“The engine is out of order and the economy is starting to slow down,” said Sung Won Sohn, a professor of finance and economics at Loyola Marymount University in Los Angeles. “The loss of momentum will continue and I am concerned that the combination of the virus’s resurgence and lack of action through Congress could push employment into negative territory.”
According to a survey by Reuters on economists, the non-agricultural wage bill was likely to increase through 1.58 million jobs in July, a sharp decline from a peak of 4.8 million in June. This would leave the wage bill at 13.1 million below its pre-forecast. Employment peaked at 152.5 million in February.
The economy, which entered recession in February, suffered its biggest blow since the Great Depression this quarter, with gross domestic product falling at its fastest speed in at least years.
However, there is a threat of absolute relief in the pay bill in July. This week’s reports showed a sharp slowdown in hiring through employers in July and a continued decline in employment in the production and service industries.
Data from Homebase, a payroll and tracking company, showed a slowdown and slight change in employment since mid-June. The Census Bureau’s Household Pulse Survey reported at least 6 million job losses from mid-June to the week ending July 18, when the government surveyed employers and families for last month’s employment report.
There have been implicit task losses in the spaces most affected by the accumulation of coronavirus infections. CoVID-19 cases, respiratory disease caused by the virus, erupted across the country last month, forcing the government in some of the hardest-hit areas in the west and south to close businesses or suspend reopening, sending staff home. Demand for property and has suffered.
RECOVERY PLAN
“It will be a shock,” said Elise Gould, senior economist at the Washington Institute of Economic Policy. “Economic recovery depends entirely on good luck in managing the spread of the virus, and this control has failed dramatically since early June.”
The expected decline in hiring would call into question expectations of the U.S. inventory market. From a V-shaped recovery. The index has risen by almost 50% since its March low. As COVID-19 instances jump and Republicans and Democrats argue about the stimulus package, economists see a W-shaped recovery.
Economists estimate that the paycheck coverage program that provided companies with loans that can be partially canceled if used for workers’ wages stored about 1.3 million jobs at their peak. Additional weekly unemployment checks of $600 accounted for 20% of the non-public source of income and helped increase customer spending in May and June.
“The moment phase of the recovery will be much more difficult,” said James Knightley, ING’s leading foreign economist in New York. “We will have to prepare for employment and spending relief in the absence of a new comprehensive and really extensive budget package.”
Average hourly earnings are expected to fall by 0.5% in July after a 1.2% decline in June, with maximum employment gains targeting low-wage industries. The week in a row is expected to fall to an average of 34.4 hours, below 34.5am in June.
The unemployment rate is expected to have fallen to 10.5% since 11.1% in June. But the unemployment rate measure has been lowered by others who are mistakenly classified as “employees but absent from work.” At least 31.3 million other people won unemployment checks in mid-July.
Economists expect the wage bill of states and local government to account for more than a portion of employment gains in July, but this is not seen as a sign of strength.
The style the government uses to eliminate seasonal fluctuations in knowledge predicts that school staff will be leaving their payroll in July. However, this happened earlier because of the pandemic, which rejected the style.
“Many of the education-related layoffs that occur in July probably occurred before this year, so July’s reading for the government payroll can be artificially strong,” said JimO’Sullivan, America’s leading macroeconomic strata at TD Securities in New York.
(Report through Lucia Mutikani; Edited through Paul Simao)