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.

  • Data shows more than 37 million have applied for or are receiving some form of unemployment benefits as of May 30, meaning the unemployment rate was likely significantly higher.

How it works: The Labor Department’s surveys capture the period through the 12th day of the month, excluding job losses after that date. To calculate a closer estimate of U.S. unemployment Axios added...

  • The Labor Department's continuing jobless claims up to May 23.
  • Continuing claims for the newly created Pandemic Unemployment Assistance (PUA) program through May 16.
  • Initial claims for both programs during those periods.
  • Other unemployment programs, including newly discharged veterans and the Pandemic Emergency Unemployment Compensation program.

The big picture: Even these more comprehensive estimates likely miss the mark, as not every state is providing PUA figures.

  • Plus, there remains an unknown number of people who have either not applied for unemployment benefits, have tried and failed, or who have applied but have not had claims processed yet.

What it means: While it's likely many Americans have returned to work, the increase in initial claims and consistently high level of continuing claims suggest the problem did not improve in the back half of May after many states began removing "stay at home" orders.

The state of play: A survey of more than 88,000 small businesses by online business network Alignable from May 23–25 found 68% are open now, but 28% were offering fewer products or services.

  • 3% of firms surveyed said they had closed permanently.
  • Less than 50% of customers have returned, firms say.
  • Only 47% employees are back on payrolls, with 7% more expected to be hired by the end of June.

What they're saying: Some business owners said they were "bleeding slowly" with increased operating costs for social distancing measures, masks and PPE for staff along with decreasing revenue.

  • "We are thrilled that we are open again," Jane, a gallery owner in California, said in the survey. "We've had to reduce our open hours so that we can do cleaning. But we’re ready and excited to have customers."
  • "The wedding industry is almost non-existent," Maxine, a bridal and event coordinator in Texas, said. "People are too afraid to celebrate."
Reproduced from Economic Policy Institute; Chart: Axios Visuals

Highlighting these difficulties, the Economic Policy Institute attempted to quantify the number of unemployed who were missed in the Labor Department's April jobs report.

  • This “adjusted” unemployment rate includes those who are officially counted as unemployed as well as what EPI senior economist Elise Gould calls the "misclassified" — those who reported that they were employed but not at work for other reasons, and those who had been employed but left the labor force when the virus hit and are not actively seeking work.
  • "Millions of would-be job seekers have left the labor force in the time of COVID-19 for various reasons, whether it’s because they don’t see any prospects in their occupation, they are not looking because they are concerned about their health or the health of members of their household, or they have to care for a child whose school or daycare closed."

Go deeper: Few jobs are safe as unemployment reaches Great Depression levels

Go deeper

Jul 2, 2020 - Podcasts

Lots of jobs, lots of questions

America added 4.8 million jobs in June, easily exceeding economist expectations, while the unemployment rate fell from 13.3% to 11.1%. But the jobs picture remains very murky, particularly as some states pause or roll back economy reopenings.

Axios Re:Cap digs into the jobs picture right now and where it's headed, with The Washington Post's Catherine Rampell.

Stimulus outlook takes a hit even as coronavirus cases skyrocket

Data: Bureau of Labor Statistics; Chart: Axios Visuals

The pandemic is getting worse, and the question is whether the economic recovery will go with it.

Why it matters: America adding 7.5 million jobs over the last two months pales in comparison to 20+ million lost over the two months prior.

Markets swell as the economy shrinks

Illustration: Eniola Odetunde/Axios

The economy is sputtering, but the markets are thriving — a highly unusual event that shows how the coronavirus has thrown all bets off.

Why it matters: The disconnect adds to the wealth gap. The richest 10% of households — who own 84% of stocks — are getting richer, while millions of out-of-work Americans cross their fingers that pandemic unemployment benefits will be extended.