The U.S. labor market unexpectedly showed a weakening performance in December with an increase in Covid-19 infection cases that constrained the nationwide supply of jobs in the United States (U.S.) and restrictions imposed by governments that restricted business operations.
Based on a report released by the Department of Manpower, the NFP only recorded a decrease of 140,000 in December. This reading is almost three times the expectations of economists who are only targeting a reduction of 50,000 jobs. This performance gives an indication that the labor market in the U.S. is weakening.
However, the unemployment rate is slightly better than analysts expect at 6.7% compared to the target set at 6.8%. Since the economic recovery that began in May, the economy has managed to add 12.3 million jobs. Among the most affected sectors are industry, hospitality, restaurants and tourism.
2020 is a difficult year for everyone, in the United States 22 million workers have been temporarily laid off between March and April. Beginning in May, the labor sector began to improve and recover from the downturn.
On the one hand, it can be seen that the private sector also suffered the same fate. ADP readings during the day showed that the recruitment of private sector workers contracted for the first time by 123,000 in December due to uncontrolled transmission of Covid-19.
The US dollar index declined 0.06% against major currencies to 89.748 exchange rates as of 9.50 p.m.
