Employment declined by 220,000 jobs in December thanks to a COVID flare up as cold weather sent people indoors, where transmission chiefly occurs. It was the first monthly decline in jobs since last April. Employment did start growing again in January, albeit by a very modest 49,000, which was slightly below expectations. The unemployment rate fell to 6.3 percent down from 6.7 percent. There are now 10.1 million people unemployed in the United States.
As the December flare-up wanes and vaccination becomes available to more of the population, it is assumed that the economic recovery will speed up. The vaccination rate at present is about 1.3 million inoculations per day. 36.7 million people have received at least one dose, well over 10 percent of the population. And another 26.7 million Americans have had the disease itself, which provides some immunity as well. So, as of the first week in February, about 19 percent of the population has some protection from the virus. What percentage of the population needs to become immune to achieve “herd immunity” is not known yet (it depends on how contagious a particular disease is), but it is estimated to be in the 60-70 percent range.
Of course, the speed of the recovery will depend also on the extent that respective state governors let their state’s economies reopen. In many places, that is already underway. Even in more restrictive locales, like New York City, indoor dining is set to resume (at 25 percent capacity) beginning on February 16th. As has been noted on Powerline, states with the hardest lockdowns have had the worst economic declines without effectively mitigating the spread of the disease. It is perhaps not a surprise that these states almost all have Democratic governors.
We still have a long way to go to get back to the pre-COVID status quo that prevailed last February, when the unemployment rate was 3.5 percent and the number of unemployed was 5.7 million.