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Economic News Release

Commissioner's Statement on the Employment Situation News Release

Transmission of material in this statement is embargoed until 
8:30 a.m. (ET) February 5, 2021.

                           Statement of

                         William W. Beach
                    Bureau of Labor Statistics

                     Friday, February 5, 2021

      The unemployment rate fell by 0.4 percentage point to 6.3 
percent in January, and nonfarm payroll employment changed 
little (+49,000). The labor market continued to be impacted by 
the coronavirus (COVID-19) pandemic and efforts to contain it. 
Notable job gains in professional and business services and in 
both public and private education were offset by losses in 
leisure and hospitality, in retail trade, in health care, and in 
transportation and warehousing.
      Substantial job losses related to the coronavirus pandemic 
first occurred in March (-1.7 million) and April (-20.7 million) 
of 2020. As economic activity resumed, employment increased by 
12.6 million from May through November but declined again in 
December (-227,000) following a surge in the number of 
coronavirus cases. In January, nonfarm employment changed little 
(+49,000) and was below its February 2020 level by 9.9 million, 
or 6.5 percent.
      The response rate for the establishment survey was slightly 
below average in January. The rate for the household survey, 
while slightly below normal due to pandemic-related issues, was 
much higher than earlier in the pandemic. The impact of the 
pandemic on the household and establishment surveys is detailed 
in the January Employment Situation news release and 
accompanying materials (available on the BLS website at
      Taking a closer look at the January payroll data, 
employment in professional and business services increased by 
97,000 over the month, led by a gain of 81,000 in temporary help 
services. Smaller job gains occurred in management and 
consulting services (+16,000), computer systems design 
(+11,000), and scientific research services (+10,000). These 
gains were partially offset by losses in services to buildings 
and dwellings (-14,000) and in advertising (-6,000). Employment 
in professional and business services has risen by 1.6 million 
since a recent low in April but remains 825,000 below its 
February level.
      In January, employment increased in local government 
education (+49,000), state government education (+36,000), and 
private education (+34,000). In both public and private 
education, pandemic-related employment declines in 2020 
distorted the normal seasonal buildup and layoff patterns. This 
likely contributed to the job gains in January (after seasonal 
      Wholesale trade continued to add jobs in January (+14,000). 
Since April, employment in the industry has risen by 146,000. 
However, it is 263,000 lower than it was in February.
      In January, mining added 9,000 jobs, mostly in support 
activities for mining (+8,000). Mining employment is down by 
133,000 since a recent peak in January 2019, though employment 
in the industry showed little change for several months prior to 
the uptick in January.
      Leisure and hospitality lost 61,000 jobs in January, 
following a large loss of 536,000 jobs in December. Employment 
in accommodation edged down in January (-18,000). After 
declining by 402,000 in December, employment in food services 
and drinking places changed little in January (-19,000). 
Employment in leisure and hospitality fell by 8.2 million during 
March and April, increased by 4.9 million from May to November, 
and then declined by 597,000 over the past 2 months.
      In January, retail trade lost 38,000 jobs, following a gain 
of 135,000 jobs in December. Over the month, job losses occurred 
in general merchandising stores (-38,000), electronics and 
appliance stores (-29,000), and nonstore retailers (-15,000). By 
contrast, employment rose in food and beverage stores (+15,000), 
clothing and accessories stores (+15,000), and health and 
personal care stores (+14,000). Since February, employment in 
retail trade is down by 383,000.
      Health care employment declined by 30,000 over the month. 
Nursing care facilities (-19,000) and community care facilities 
for the elderly (-7,000) continued to lose jobs in January. 
Employment also declined in home health care services (-13,000). 
Health care employment is 542,000 lower than its February level.
      In January, transportation and warehousing lost 28,000 
jobs, including a loss of 17,000 in warehousing and storage. 
Couriers and messengers lost 14,000 jobs in January and 31,000 
jobs in December, following an unusually large job gain in 
November (+72,000). Employment in air transportation increased 
by 15,000 in January but is down by 105,000 since February.
      Employment in manufacturing changed little in January      
(-10,000), with a decline of 17,000 in durable goods industries. 
Manufacturing employment has increased by 803,000 since April 
but is down by 582,000 since February, before the onset of the 

      Construction employment changed little in January (-3,000), 
after increasing for 8 consecutive months. However, employment 
in the industry is down by 256,000 since February.
      Employment in other major industries--including 
information, financial activities, and other services--showed 
little change over the month.
      Average weekly hours for all private-sector workers 
increased by 0.3 hour in January to 35.0 hours. The average 
workweek for manufacturing increased by 0.3 hour to 40.4 hours.
      Average hourly earnings of all employees on private nonfarm 
payrolls increased by 6 cents to $29.96 in January, following an 
increase of 29 cents in December. One should continue to use 
caution when interpreting changes in average weekly hours and 
average hourly earnings during the pandemic, as large shifts in 
the industry composition of employment can complicate monthly 
      Turning to the labor market indicators from the household 
survey, the unemployment rate fell by 0.4 percentage point to 
6.3 percent in January, and the number of unemployed people 
declined to 10.1 million. Both measures have fallen from their 
recent peaks in April 2020 but remain well above their February 
2020 levels (3.5 percent and 5.7 million, respectively).
      Among the major worker groups, the unemployment rates 
decreased in January for adult men (6.0 percent), adult women 
(6.0 percent), Whites (5.7 percent), and Hispanics (8.6 
percent). The jobless rates for teenagers (14.8 percent), Blacks 
(9.2 percent), and Asians (6.6 percent) showed little change.
      Among the unemployed, the number of people on temporary 
layoff decreased to 2.7 million in January and is down 
considerably from the high of 18.0 million in April. At 3.5 
million, the number of permanent job losers changed little in 
January but is up by 2.2 million since February. The number of 
reentrants--people who previously worked but were not in the 
labor force prior to beginning their job search--declined to 2.0 
million in January.
      By duration of unemployment, the number of people searching 
for work for less than 5 weeks decreased over the month to 2.3 
million. The number of people searching for work for 27 weeks or 
more (often referred to as the long-term unemployed), at 4.0 
million, was about unchanged over the month but is up by 2.9 
million since February. In January, the long-term unemployed 
accounted for 39.5 percent of the unemployed.
      Both the labor force participation rate and the employment-
population ratio changed little over the month, at 61.4 percent 
and 57.5 percent, respectively. Since February, the 
participation rate is down by 1.9 percentage points, and the 
employment-population ratio is down by 3.6 percentage points.
      In January, 6.0 million people were working part time for 
economic reasons (also referred to as involuntary part-time 
workers), little changed from the previous month. The number of 
people affected by this type of underemployment is 1.6 million 
higher than in February.
      At 7.0 million, the number of people not in the labor force 
who currently want a job edged down in January. Among those who 
were not in the labor force but wanted a job, the number of 
people marginally attached to the labor force declined to 1.9 
million. (People who are marginally attached to the labor force 
had not actively looked for work in the 4 weeks prior to the 
survey but had looked for a job within the last 12 months.) The 
number of discouraged workers, a subset of the marginally 
attached who believed that no jobs were available for them, at 
624,000, was essentially unchanged over the month.
      Since March 2020, household survey interviewers have been 
instructed to classify employed people absent from work due to 
temporary, coronavirus-related business closures or cutbacks as 
unemployed on temporary layoff.
      As in previous months, some workers affected by the 
pandemic who should have been classified as unemployed on 
temporary layoff in January were instead misclassified as 
employed but not at work. However, the share of responses that 
may have been misclassified was considerably smaller in recent 
months than at the onset of the pandemic.
      For March through December, BLS published an estimate of 
what the unemployment rate would have been had misclassified 
workers been included among the unemployed. Repeating this same 
approach, the seasonally adjusted January unemployment rate 
would have been 0.6 percentage point higher than reported. 
However, this represents the upper bound of our estimate of 
misclassification and probably overstates the size of the 
misclassification error. Additional information is available on 
the BLS website at
      Looking at supplemental pandemic-related measures from the 
household survey (these supplemental data are not seasonally 
adjusted), the share of employed people who teleworked in 
January because of the coronavirus pandemic edged down to 23.2 
percent. These data refer to employed people who teleworked or 
worked at home for pay at some point in the last 4 weeks 
specifically because of the pandemic.
      In January, the number of people who reported that they had 
been unable to work because their employer closed or lost 
business due to the pandemic--that is, they did not work at all 
or worked fewer hours at some point in the last 4 weeks due to 
the pandemic--decreased to 14.8 million. Among those who 
reported in January that they were unable to work because of 
pandemic-related closures or lost business, 12.7 percent 
received at least some pay from their employer for the hours not 
worked, little changed from December.
      Among those not in the labor force in January, 4.7 million 
people were prevented from looking for work due to the pandemic, 
little changed from December. (To be counted as unemployed, by 
definition, individuals must either be actively searching for 
work or on temporary layoff.)
      Following our usual practice, there were routine annual 
adjustments to the data from our two surveys. The establishment 
survey data released today reflect the incorporation of annual 
benchmark revisions. Each year, we re-anchor our sample-based 
survey estimates to full universe counts of employment, 
primarily derived from the Quarterly Census of Employment and 
Wages, which counts jobs covered by the unemployment insurance 
tax system. Payroll employment for March 2020 was revised 
downward by 250,000 (on a not seasonally adjusted 
basis, -121,000 or -0.1 percent). Not seasonally adjusted, the 
average benchmark revision over the past 10 years was plus or 
minus 0.2 percent. (Additional information about the benchmark 
revision and its impact is contained in our news release and on 
our website at
      Household survey data for January reflect updated 
population estimates from the U.S. Census Bureau. Again this 
year, the impact of the new population controls on the 
unemployment rate and other ratios was negligible. (Further 
information can be found in our news release and on our website 
      In summary, the unemployment rate fell to 6.3 percent in 
January, and total nonfarm payroll employment changed little 

Last Modified Date: February 05, 2021