Unemployment Reportedly Fell To 11.1% In June — But There’s More To The Story

Every Thursday, the Bureau of Labor Statistics publishes a weekly report on unemployment — and since the beginning of the coronavirus pandemic, we’ve been nervously awaiting its release every week, watching as the number of unemployed Americans continued to rise. But today’s report has caused more of a stir than usual, because it finally seems to give us some good news: the overall unemployment rate has dropped to 11.1% in June, compared to 13.3% in May.

But the reality is, this simple statistic fails to tell the whole story of joblessness in America right now. Heidi Shierholz, Director of Policy at the Economic Policy Institute, thoroughly put the report in context in a Twitter thread this morning. “The official unemployment rate was 11.1% in June, a welcome improvement from the last two months — but aside from April and May, it’s still higher than any unemployment rate we’ve seen since the Great Depression,” she wrote.

She also pointed out that the data doesn’t yet reflect the enormous spikes in COVID-19 cases that we’ve seen recently in states like California, Florida, and Texas. “We are already hearing reports of people being laid off for the second time,” she explains. It’s unclear how much of the 4.8 million jobs added in June will be long-lasting, because over 2 million of those jobs were added to the leisure and hospitality industries.

There’s also a problem of misclassifying workers. The BLS doesn’t count furloughed workers in its official unemployment rate — those workers are listed as “employed but not at work,” according to the EPI. In May, that meant that the actual unemployment rate was closer to 16.4%, and not 13.3% as the BLS’ official count suggests. Shierholz noted that in June, on top of the misclassified furloughed workers, “There were also 5.0 million who were out of work as a result of the virus but were being counted as having dropped out of the labor force.” She continued, “If all these workers were taken into account, the unemployment rate would have been 15.0% in June.”

And this doesn’t even begin to take into account the huge variance in unemployment by gender and race. The nation has been having a powerful, ongoing conversation about racism since the George Floyd protests began in late May — yet by simply touting the new unemployment rate as 11.1%, we’re continuing to irresponsibly flatten how crises impact Black Americans and other people of color. A single number can’t represent the realities of everyone in this country. Though overall unemployment appears to have fallen in June, the unemployment rate for Black men is higher than it’s ever been since the start of the pandemic, now sitting at 16.3%. 

We’ve also known for a while that women are facing more joblessness due to COVID-19 than men, largely due to occupational segregation, but separating by race reveals an even more gruesome picture. According to the EPI, in May the percentage of all women out of work due to COVID-19 was 21.8%, compared to 17.3% for men. But for Black women, it was 25.4%; for non-white Latinx women, it was 29.6%; for Asian women, it was 26.7%.

In comparison, the unemployment rate for white men was 14.1% — less than half the rate it was for non-white Latinx women.

The EPI also estimates that 11% of those unemployed in May didn’t have a reasonable expectation of returning to their old jobs. “The survey the unemployment data are from asks unemployed workers who lost a job if they expect to return to work,” the report says. “Of the 21.0 million officially unemployed in May, 15.3 million expect to be called back to their old job, which means 5.6 million of the officially unemployed do not expect to be recalled to a former job.” It also estimates that many furloughed workers who said they expect to to return to their jobs may not actually do so. Other studies have suggested that around 30% of jobs lost in some industries may never return, instead being reallocated to other sectors.

All of these important details are lost when we focus only on the unemployment rate released by the BLS every week. Non-white workers in particular are suffering from joblessness, yet Congress has yet to pass additional economic relief measures to help these Americans survive. With the possibility of many jobs being lost again as states with surging cases reclose businesses, combined with the fact that the $600 given by Pandemic Unemployment Assistance will end soon, it’s hard to have a positive outlook on the economy as we enter July.