Coronavirus surge has economists not believing ‘hype’ of June jobs blowout

The good news: June saw asecond consecutive month of record-breakingjob market gains, with nearly 5 million people getting back to work as coronavirus-related lockdowns were relaxed. The jobless rate also tumbled to 11.1%, with more dislocated workers being absorbed by the ravaged labor market.

Now, the bad news: Despite two months of seven-digit job creation, those aren’t enough to counteract the staggering numbers of jobless workers still in limbo.In fact, the more compelling story could be found in weekly unemployment data, released simultaneously with the non-farm payrolls report that showed over 19 million continuing claims. 

Since the coronavirus became a byword for economic decimation, nearly 50 million have filed for unemployment benefits. To date, over 30 million of them remain without jobs, economists pointed out on Thursday.

European banking giant ING succinctly summarized the dynamic using the title of a song from iconic 80s rap group Public Enemy: “Don’t believe the hype.”

June’s blowout jobs report was “great news, but it doesn't tell the whole story. 31.5 million people are claiming unemployment benefits and employment is still 15 million lower than February,” wrote James Knightley, ING’s chief international economist.

“Moreover, with states dialing back on re-openings the July jobs report could be far more sobering,” he added.