Employers added 1.4M jobs in August, but subtracted 1.6K in accounting
Employment increased by 1.4 million in August, the U.S. Bureau of Labor Statistics reported Friday, as the unemployment rate fell to 8.4 percent from 10.2 percent in July amid signs of economic recovery despite the ongoing COVID-19 pandemic, although the number of accounting and bookkeeping jobs declined last month by 1,600.
The BLS reported that the improvements in the labor market reflect the continued resumption of economic activity that had been curtailed due to the coronavirus pandemic and efforts to contain it. The numbers were also bolstered by an increase in government employment due to temporary hiring of census workers. Other job gains occurred in retail trade, professional and business services, leisure and hospitality, and education and health employment claims.
In addition, the BLS revised downward the numbers reported for June and July, decreasing them by 10,000 in June from a gain of 4,791,000 jobs to 4,781,000, and 29,000 for July, reducing it from a gain of 1,763,000 to 1,734,000. With those revisions, employment in June and July combined was 39,000 less than previously reported.
Despite the declines in accounting and bookkeeping, the BLS reported gains in many sectors, including other types of professional and business services, where the overall gain was 197,000.
“The jobs report was definitely positive,” said Tom Gimbel, CEO of the staffing and recruiting firm LaSalle Network. “This is a huge plus, and the fact that we added over a million non-government jobs really is a strong sign that things are a lot stronger than people anticipated and headed in the right direction.”
Many employers are still looking for accounting and finance employees, on both an interim and permanent basis, he noted. “We’re continuing to see fairly strong demand, both on the staff and management levels,” he added. "They’re continuing to build up their accounting infrastructure and add qualified people.”
Despite the strong jobs report, there are worrisome signs throughout the economy as the pandemic continues to ravage businesses and individuals.
“A closer look at today’s report reveals a tale of two Americas: Furloughed workers being recalled are seeing nearly all of the employment gains as permanent job losses continue to rise,” said Rep. Richard Neal, D-Massachusetts, chairman of the tax-writing House Ways and Means Committee, in a statement. “While government employment counted for a fourth of this month’s employment increase, that count included temporary census workers whose jobs will evaporate at the end of this month.”
The ranking Republican on the committee, Rep. Kevin Brady of Texas, called it a “blowout” report, however. “With 1.4 million new jobs in the August jobs report, we have recovered nearly half of the jobs lost at the lowest point of the pandemic in March,” he said in a statement.
Top 100 Firm CBIZ released its monthly Small Business Employment Index on Friday, and found that small-business hiring decreased in August for the first time since businesses initially began reopening after the shutdown earlier this year. After hiring gains in June and July, the August decline signals a possible pullback in small-business hiring recovery. Hiring seemed to decline in those states that reopened on or before May 15 (down 0.44 percent) and those that reopened after that date (down 0.48 percent). Hiring declined the most in the West, as well as in the Northeast and Southeast.
“The economy has proven volatile in the wake of COVID-19, and many analysts have debated the possibility of a V-shaped recovery, but this now appears unlikely,” said CBIZ executive vice president Philip Noftsinger in a statement. “The CBIZ SBEI and recent initial unemployment claims data indicate that we have moved past the preliminary bounce in hiring as the economy began to reopen and are now settling in to recessionary employment levels.”
Industries with the most noteworthy hiring declines were administrative and support services, manufacturing, and real estate, according to CBIZ. Only a few industries had noticeable hiring growth in August, including educational services, transportation, and technology and life sciences. “We are seeing the shutdown take a toll on small-business hiring,” Noftsinger stated. “Businesses that survived the economic shock will need to prepare for a prolonged period of recovery, which could take us into mid-2021.”