U.S. Jobs: December Report Rings Out 2020 on a Low Note

The U.S. employment marketplace closed out 2020 on a down note.

The U.S. Bureau of Labor Statistics published its December jobs report on Jan. 8. The outlook is not terribly cheery: For the first time since May, which brought the first signs of recovery after the pandemic knocked the stuffing out of employment totals in March and April, the December report discloses a net loss, with the economy contracting to the tune of 140,000 jobs out the door.


Though job losses in leisure and hospitality and private education pushed the balance into negative territory, they were in part offset by gains in professional and business services, construction, and retail. At the same time, weekly first-time unemployment claims are also trending upward and cracked the 1 million mark for the first time since last August.


It looks like the pandemic still has teeth and is biting into overall employment again, pushing job creation down and lifting unemployment claims up.


More Insight from the Employment Situation Summary


To take stock of the usual adjustment of prior reports, October jobs created increased from 610,000 to 654,000, while November jumped a substantial 91,000 jobs, but that still only boosts the total jobs added up to 336,000. This short-term recap affirms on ongoing decline which unfortunately slipped into negative territory for December.


Interestingly, the December report includes mention that 23.7 percent of the active workforce is teleworking, up from 21.8 percent in November. In addition, 18.5 million people reported themselves unable to work because an employer closed or lost business because of the pandemic, while an additional 4.6 million unemployed people were unable to look for work for the same reason.


Hospitality and leisure was the biggest loser in December, down by 498,000 jobs for December. Of that total, 75 percent were from food services and drinking establishments (-372,000). But employment also fell in amusements, gambling, and recreation (-92,000); and in accommodations (-92,000) as well. Overall, this sector is down by 3.9 million jobs (23.2 percent) since last February.


Employment in private education dropped by 63,000 in December (and is now down by 450,000 since last February). Government employment is also down, with a 45,000 jobs dip for December. Here, most of that loss comes from local government excluding education (-32,000), with state government education down by 20,000.


Since February, all government jobs (local, state and federal) are down by 1.3 million. Other services lost 22,000 jobs for December, of which about half (12,000) comes from personal and laundry services. Overall this sector is down by 453,000 jobs since February.


Sectors that added jobs in December include the following:


The December jobs report from the U.S. Bureau of Labor Statistics is a bit of a kick in the pants.

Professional and Business Services added 161,000 jobs, with 68,000 of that for temporary services, and 20,000 in computer systems design and related services. Other growing sub-sectors were: other professional and technical services, up 11,000; management of companies and enterprises, also up 11,000; and business support services, up 7,000. Even so, employment in this sector is down by 858,000 since February 2020.

Retail Trade added 121,000 jobs, with almost half going to general merchandise outlets (including warehouse clubs and supercenters), which rose by 59,000 jobs. Other gainers were: non-store retailers, up 14,000; automobile dealers, up 13,000, health and personal care stores, up 10.000; and food and beverage stores, up 8,000. Nonetheless, current retail employment is still down by 411,000 since February.

Construction added 51,000 jobs, with the big gainers checking in as follows: residential specialty trade, up 14,000; residential building, up 9,000; non-residential specialty contractors, up 18,000; and heavy and civil engineering construction, up 15,000. Overall, construction is down 226,000 since February, 2020.

Transportation and Warehousing added 47,000 jobs.

Healthcare added 39,000 jobs.

Manufacturing added 38,000 jobs.

Wholesale Trade added 25,000 jobs.


Other sectors were mostly unchanged, including our home sector of information, as well as mining and financial activities. Overall up and down sectors (by count) show a  larger number of small increases failing to offset a smaller number of heavier drops. Given the pandemic's worsening drag on the economy, I expect to see the up sectors tilting toward if not into negative territory in next month's report. But gosh: I'd love to be wrong about that.


CompTIA's End-of-year Reflections on 2020


On Jan. 8, CompTIA reacted to the jobs report with a more upbeat assessment of 2020 titled Tech Hiring Stands Out in December Jobs Report. They report a net gain for December technology company jobs of 22,000, with an overall gain for 2020 of 391,000 technology jobs across all companies.


The CompTIA stat-heads also report a tech unemployment rate of 3 percent for December, versus a general unemployment rate of 6.7 percent for the whole economy (unchanged from November, despite the reported job losses). Tech hiring in December comes mostly — to the tune of 20,300 jobs, in fact — from IT services and custom software development.


Other rosy-looking tech sub-sectors in December included data processing, hosting, and related services, up 2,600 jobs; computer, electronics, and semiconductor manufacturing, up 1,600 jobs; and other information services, including search portals, up 200 jobs. This was offset by a loss of 2,500 jobs in telecommunications.


The December jobs report from the U.S. Bureau of Labor Statistics is a bit of a kick in the pants.

In that same press release, CompTIA also reports a "modest increase of employer job postings for core IT positions" to around 207,000 for December. Software and application developer openings jumped by 62,900, with these other increases: IT support specialist, up 18,100; systems engineers and architects, up 16,600; systems analysts, up 13,700; and IT project managers, up 13,500.


Thus, there appears to be plenty of unsatisfied demand for IT professionals across most job categories, something that augurs well for both aspiring IT workers, and professionals already in the field interested in promotions or changing jobs.


Where 2020 Leaves the Job Market


In general, things are somewhat iffy, and a bit scary right now. Fortunately for those who work in information technology companies, or in an IT role for some other kind of company, things are nowhere near dire. Nonetheless, given overall economic trends, it's probably wise for IT professionals to keep a careful eye on working conditions, and ponder carefully their employer's exposure to pandemic influences.


The bad news is that there might be some fallout coming, even for IT pros. The good news is that it looks like IT workers laid off or set adrift in the wake of company failures shouldn't have too hard a time finding a new job, should they need one.


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About the Author

Ed Tittel is a 30-plus-year computer industry veteran who's worked as a software developer, technical marketer, consultant, author, and researcher. Author of many books and articles, Ed also writes on certification topics for Tech Target, ComputerWorld and Win10.Guru. Check out his website at www.edtittel.com, where he also blogs daily on Windows 10 and 11 topics.