AL(BA)NY — Thursday’s U.S. Labor Department report on initial jobless claims was the latest sign that the recovery in the job market isn’t going to be smooth.The number of initial claims for unemployment benefits in New York state rose by more than 9,000 to 50,353 for the week ending Dec. 26, according to the report.
And analysts found little to cheer about even as the number of new claims nationwide fell by 19,000 to a seasonally adjusted 787,000.
“The 4-week moving average of continued jobless claims has been moving lower since before Thanksgiving, but more from people exhausting benefits and rolling off than from getting back to work,” observed Greg McBride, chief financial analyst at Fintech Zoom. “The recently signed stimulus bill that extends unemployment benefits to 50 weeks is likely to reverse this trend – not heralding bad news as much as providing a more accurate reflection of extended unemployment.”
The Capital Region lost tens of thousands of jobs in the wake of the Covid-19 pandemic, which temporarily shut down much of the economy last March. The number of jobs based in the five-county Albany metropolitan statistical area by April had tumbled to 400,800 from 473,100 in the same month a year earlier, a loss of 72,300 jobs.
While that figure has since recovered to 438,600, that’s still 43,800 below the year-earlier figure for November, the latest available.
The Albany metro’s labor force also has been shrinking, and it’s not clear what has happened to those workers. The labor force is made up of people who are employed and those who are unemployed but actively seeking work.
The number bottomed out at 431,600 in October, a two-decade low, before recovering slightly to 432,500 in November. Still, that’s more than 19,000 fewer than the same figure a year earlier, according to state Labor Department data.
Right now, with the holiday season winding down, the number of coronavirus cases and deaths surging, and a rollout of two vaccines that’s going more slowly than officials had hoped, The next few months likely will challenge the economy.
A number of restaurants have announced they’d close temporarily after the holidays, while hotels and retailers face uncertain demand. On Thursday, industry monitor STR reported that the nation’s weekly hotel occupancy rate fell to its lowest level since early May. Just 32.5 percent of available rooms were occupied, down by a third from a year earlier, while the average daily room rate was $92.08, down 28.8 percent from a year earlier.
Statewide, 568,000 workers in the accommodations and food services sector filed initial claims for unemployment during the pandemic weeks of March 14 through Dec. 26, according to state Labor Department figures. Other hard-hit sectors include health care and social assistance, with more than 460,000 filings during the period, and retail trade, with claims totaling 432,000.
The health care job losses are likely those not associated with pandemic care.
Officials hope the new vaccines — a third received approval last week from United Kingdom health authorities — will eventually gain the upper hand against the virus’ spread.
And the $900 billion relief package signed last weekend by President Trump will provide some relief to the unemployed, business owners and the nation’s transportation sector, although observers suggest the figure is far short of what is needed.
“That’s not enough,” said Hugh Johnson during his annual economic outlook presentation in December to the Capital Region Chamber of Commerce. “But at least they’re looking at something.”
Johnson, founder, chairman and chief investment officer at Albany-based JNB-Hugh Johnson Advisors, said the long-term outlook is bright, comparing it to the growth seen during the Roaring 20s, another recovery that followed a worldwide pandemic. But he also sees the odds of recession peaking in February at 30.7 percent.
“The U.S. economy is going to continue recovery through 2021 and 2022,” he said in his Dec. 3 presentation. But, he added, the economy won’t be back to the level it reached at the end of 2019 until 2023.
Job growth has been slowing in recent months. The labor market also has seen a shift in job growth as the economy moves from one based on manufacturing to one based on knowledge and technology, Johnson said. Climate change may be driving at least some of it. Johnson pointed out that two of the fastest growing job categories were wind turbine service technicians and solar voltaic installers.
“That’s all I need to say,” he said.