Most economists believe the true unemployment rate is several points higher, but as long as it’s declining, it’s still good news. At least 11 million people were classified as unemployed in October.
A flurry of new government restrictions across the country to combat the pandemic are likely to fall most heavily on restaurants, hotels, entertainment venues and other businesses whose access to customers has been limited.
These are among the industries that suffered the most job losses in the spring. Some such as restaurants brought back millions of workers in the summer and early fall, but if the momentum flags significantly enough, it could produce a weak November jobs report.
Manufacturers and construction firms may have also cut back on hiring and employment in November due to the recent surge in coronavirus cases and the inability to find enough skilled workers.
“Labor market conditions are choppy,” said chief economist Robert Dye of Comerica bank in Dallas.
Also watch the number of hours workers put in on the job in the data. If the coronavirus pandemic is having a big negative effect, the length of the workweek could slip from 34.8 hours in October.
Chances of an outright drop in employment aren’t farfetched.
Jobless claims rose early in November to the highest level in more than a month, for one thing. A pair of ISM surveys of business leaders at large companies pointed to weak employment growth. And time-sheet trackers of small and medium-sized firms also noticed a slowdown in November.
A decline in employment might not dampen the optimism of Wall Street /zigman2/quotes/210598065/realtime DJIA +1.85% investors, however. They would likely place greater odds on Congress or the Federal Reserve taking fresh steps to revitalize the economy.