(FamilyRetirementClub.Com)- The March jobs report that was released Friday revealed ominous numbers.
For the first time in more than 10 years, the economy lost more jobs than it gained in the month, shedding a total of 701,000 jobs, according to the Bureau of Labor Statistics. The unemployment rate jumped all the way up to 4.4% from 3.5% the month before, marking the largest change from one month to the next since January 1975.
But the situation is expected to get way worse next month, as the two surveys that make up the report — one survey of 145,000 businesses and government agencies, and another of 60,000 households — are conducted during the week that includes the 12th day of the month. In March, that means results only included the very early times of the coronavirus outbreak.
The job loss totals marked the worst month for jobs in the country since March 2009. It was also the first month the American economy actually lost more jobs than it gained since September 2010.
The hardest-hit industry was restaurants and bars, which contributed 417,400 jobs to the overall. Retailers were next on the list with 46,200 jobs lost, followed by health care employment at 43,000 jobs.
The only slight “positive” news from the report was that a majority of layoffs were temporary, with 1.8 million people being temporarily unemployment in March compared to 1 million in February.
The current state of affairs in the jobs market is actually much worse than the March jobs report reflects, but those numbers won’t come out until the April jobs report that is scheduled to be released May 8. That report is expected to include the majority of the close to 10 million people who filed for first-time unemployment benefits over the last two weeks alone.
Of course, not all 10 million of those jobs will reflect on the April jobs report, as workers who were furloughed are able to file for unemployment benefits in many states.
The worst-case prediction for how bad the unemployment rate could get is from the St. Louis Fed, which believes it could grow to greater than 30%. The highest unemployment rate on record was during the Great Depression, when it stood at 24.9% in 1933, according to the Bureau of Labor Statistics.
During the Great Recession a decade ago, the highest the unemployment rate reached was 10% back in October 2009. The current unemployment rate is expected to soar past that in the second quarter of this year, the Congressional Budget Office said Thursday.
The hope is that all of this doom and gloom data will be just temporary. As the coronavirus spread starts to slow and restrictions are loosened, jobs are predicted to be added again and people are expected to go back to work.
Nela Richardson, who is a principal and investment strategist at Edward Jones, said this should eventually reflect in the stock market. She said:
“Markets have already priced in a lot and April will be another horrible month. But what will happen after April? There will be a phasing in period as people return to work, and the market can’t predict that.”