May 8, 2020 - Economy & Business

Unemployment rate soars to 14.7% in April

Data: Bureau of Labor Statistics; Chart: Axios Visuals

The U.S. economy shed a record 20.5 million jobs in April as the unemployment rate skyrocketed to 14.7% — more than quadrupling from the rate seen before the coronavirus outbreak — according to government data released Friday.

Why it matters: It's by far the worst jobs report in history, highlighting the depth of the unprecedented toll the pandemic is having on the labor market.

By the numbers: Not since the Great Depression has the unemployment rate been this high.

  • The speed with which the job destruction happened is also staggering: the unemployment rate jumped 10.3% in a single month, which has never happened before in history.

Between the lines: You’re only counted as unemployed if you’re actively looking for work, but many Americans aren’t looking for work because of state-imposed lockdowns — effectively warping the rate.

  • Another 9.9 million people were jobless, but not counted as unemployed because they weren't actively looking for work.
  • Labor Department officials also said if certain jobless workers were considered unemployed rather than "absent from work," then the unemployment rate "would have been almost five percentage points higher," per the release.

What to watch: The job market recovery hinges on employers welcoming workers back to work once lockdown restrictions ease.

  • Of the 20.5 million jobs lost: 18.1 million unemployed workers said their layoff was temporary, while 2 million said they were permanent job losers.
  • Yes, but: There's no guarantee that temporarily laid off workers will return to work, particularly as businesses shutter from economic pressure or operate at a lower capacity.

What they're saying: "This has to be the most heartbreaking day in the history of the job market," Austan Goolsbee, former chair of the Council of Economic Advisers during the Obama administration, told CNBC.

Go deeper

The difficulty of calculating the real unemployment rate

Data: U.S. Department of Labor; Note: Initial traditional state claims from the weeks of May 23 and 30, continuing traditional claims from May 23. Initial PUA claims from May 16, 23, and 30, continuing PUA and other programs from May 16; Chart: Andrew Witherspoon/Axios

The shocking May jobs report — with a decline in the unemployment rate to 13.3% and more than 2 million jobs added — destroyed expectations of a much worse economic picture.

Why it matters: Traditional economic reports have failed to keep up with the devastation of the coronavirus pandemic and have made it nearly impossible for researchers to determine the state of the U.S. labor market or the economy.

Unpacking a surprise jobs report

Illustration: Rebecca Zisser/Axios

Can we trust this morning's surprisingly good employment report?

  • The short answer: Yes.

Trump's week of viral quicksand

Data: NewsWhip; Chart: Andrew Witherspoon/Axios

Stories about President Trump's photo op at St. John's church after peaceful protesters were forcefully cleared from the area averaged the most online attention of any issue about the president this week.

Why it matters: Trump's force-over-compassion approach to the demonstrators protesting the murder of George Floyd had Republican allies backpedaling to keep a distance — and led to a wave of condemnations that got plenty of online traction on their own.