U.S. Economy Lost 140,000 Jobs in December 2020

There’s no question that 2020 will go down as one of the most challenging years in recent memory for many Americans. Yet, after major job losses in the spring of last year, employment began to rebound as businesses were allowed to reopen. Unfortunately, following months of slowing growth, job figures ended the year on a down note.

According to the latest report from the U.S. Bureau of Labor Statistics, the economy shed 140,000 jobs in the last month of 2020. This marks the first decline in jobs in eight months, with the economy previously steadily reclaiming jobs after April’s 20.8 million job loss. As a result, the U.S. is still down a total of 9.8 million from February. Despite the drop in jobs, the unemployment rate remained at 6.7% in December — an improvement from the 8.1% in April but still a far cry from the 3.5% in February 2020.

Taking a closer look at the figures, the underline number was mostly driven by a loss of 498,000 jobs in the leisure and hospitality sector. This includes 372,000 job losses at bars and restaurants — many of which may have been forced to close or layoff workers due to increased lockdown measures in parts of the country amid surging COVID-19 case numbers.

U.S. Secretary of Labor Eugene Scalia mentions, “Meanwhile, employment grew in December in six of the nine major industrial sectors that had significant changes, including manufacturing and retail.” Scalia went on to note that the majority of job losses “appear concentrated in temporary rather than permanent layoffs.” To that point, Glassdoor’s Senior Economist Daniel Zhao said of the report, “I think there is a case for cautious optimism. If losses are mostly contained to temporary layoffs, then targeted aid might be able to bridge the gap until there’s mass vaccination.”

Obviously this report comes at the end of what’s proven to be a turbulent week in the United States of America. However, there is reason to believe that we could finally be turning a corner in the coming weeks. While it remains unclear when the vaccines that are currently being distributed will be available to all, more stimulus actions could be on the way as it appears that the Democrats will soon control both chambers of Congress along with the White House — meaning that legislation drafted is more likely to be signed into law without facing the same roadblocks that have halted previous efforts. With that, we’ll have to wait and see if the U.S. economy can make a comeback in 2021.


Jonathan Dyer

I'm a small town guy living in Los Angeles looking to make solid financial decisions. I write for a number of finance websites, including HuffingtonPost and Business2Community. I founded DyerNews.com in 2015 to focus on personal finance and the emerging FinTech markets.

Other Articles by Jonathan Dyer

Robinhood Reveals More Details on Upcoming Retirement Account

After officially announcing plans for retirement accounts during an earnings call last month, Robinhood has now revealed more details about the upcoming feature and opened a waitlist for customers. First, Robinhood Retirement will offer both Roth and Traditional IRAs to users. With these accounts, customers will be able to invest in stocks and ETFs. Additionally, accountholders will be able to craft a custom portfolio and will be able to view...

Discover Announces 5% Bonus Categories for First Quarter of 2023

The popular Discover It card — which features 1% on all purchases as well as a slate of bonus rotating categories each quarter — has revealed what purchases will earn cardholders that 5% bonus starting January 1st. For the first quarter of 2023, Discover It cardholders can earn 5% back on grocery store, drug store, and select streaming service purchases. However, there are a few asterisks to note with this offer....

AllWork Raises $4.9 Million From FINTOP Capital 

A FinTech focused on freelancer payroll has closed a significant early-round investment. This week, AllWork announced that it had raised a $4.8 million round. The Series A was led by Nashville-based FINTOP Capital with no other participants. As a result of the transaction, FINTOP's Chris Haley and Rick Holton will join AllWork's board of directors. Previously, AllWork closed a $3.8 million seed round in 2019, bringing their to-date funding total to $8.7...