In September, the unemployment rate declined by 0.5 percentage point to 7.9 percent, and the number of unemployed persons fell by 1.0 million to 12.6 million. Both measures have declined for 5 consecutive months but are higher than in February, by 4.4 percentage points and 6.8 million, respectively.While the topline unemployment rate is back below 8% (at 7.9%), last month's drop wasn't entirely for a good reason. It’s because nearly 700,000 people dropped out of the labor force in September, which accounted for most of the decline. Unemployment rate, US September 2020 Aug unemployment rate 8.42% Sept unemployment rate with Aug labor force 8.25% (-0.17%) Sept unemployment rate with Sept labor force 7.86% (-0.39%) Granted, there was a huge jump in employment in the household survey last month, so maybe September’s decline is a regression to the norm. But the percentage of people working (as measured in the employment-population ratio) is still at the lowest levels this country has seen since early 1976. The US participation rate is also at its lowest level since the mid-1970s, 2% lower than it was at the start of this year.
The change in total nonfarm payroll employment for July was revised up by 27,000, from +1,734,000 to +1,761,000, and the change for August was revised up by 118,000, from +1,371,000 to +1,489,000. With these revisions, employment in July and August combined was 145,000 more than previously reported. (Monthly revisions result from additional reports received from businesses and government agencies since the last published estimates and from the recalculation of seasonal factors.)Put that 145,000 in revisions on top of the 661,000 new jobs, and that’s just over 800,000. Conversely, it also means that September’s job growth was cut by more than 55%, which is an ominous sign going forward. This is especially true when you realize that we are still 10.7 million total jobs below our peak in February, and 9.8 million in the private sector. Which means we have barely gained back half the jobs that were lost in March and April.