LULU GARCIA-NAVARRO, HOST:
Can you fix the economy without defeating the virus? New job numbers out this morning suggest the answer is no. Job growth slowed sharply last month as the pandemic picked up pace. The Labor Department said this morning that employers added just 245,000 jobs in November. That's less than half as many as the month before. NPR's chief economic correspondent Scott Horsley joins us now. Hi there.
SCOTT HORSLEY, BYLINE: Good to be with you, Lulu.
GARCIA-NAVARRO: Scott, forecasters had expected a drop-off in hiring last month, so this is not not expected. But this is a steeper drop than most predicted. What happened?
HORSLEY: Yeah. The job growth is really nearing stall speed in the U.S., especially in industries that require face-to-face contact. Bars and restaurants cut 17,000 jobs last month. Retailers shed 35,000 workers. We saw a general slowdown of hiring in most industries with the exception of health care. There was also a surge in warehouse and transportation hiring. And that shows that people aren't necessarily avoiding holiday shopping this year. They're just doing most of it online.
We also saw a decline in November in government jobs, some of which was expected. Ninety-three thousand temporary census workers were laid off last month as the headcount wound down. And another 21,000 local government jobs were cut in education. That likely reflects support staff in schools that have been close to in-person learning.
GARCIA-NAVARRO: So we've seen job growth dropping steadily now for five months. Where does this leave the overall economy?
HORSLEY: With a long way to go, I'm afraid. Of the 22 million jobs that were lost back in the spring, we have recovered now 56%. That's positive. But it does mean there's still 9.8 million fewer people in payroll jobs now than there were before the pandemic. And the steady decline in job growth suggests that the climb out of the hole is getting steeper. You know, the people who could easily go back to work have already done so, while the people who are now unemployed face a long road home, especially as the pandemic itself is getting worse. And that's forcing...
HORSLEY: ...New restrictions on businesses. And it's making consumers more nervous about going out and spending money.
GARCIA-NAVARRO: Scott, explain this, though. The unemployment rate actually fell in November.
HORSLEY: Yeah. But the only reason the jobless rate fell last month was because 400,000 discouraged workers dropped out of the labor force. Unemployment has fallen sharply from its peak of nearly 15% back in the spring. But last month's drop was not for the reasons we like to see. Overall, the rate at which people are participating in the workforce right now is still about 2% lower than it was before the pandemic. And that means there's a lot of productive capacity in the economy that is just stuck on the sidelines until we get hold of this pandemic.
GARCIA-NAVARRO: And I guess what these numbers really mean is that the need continues in this country. And yet Congress continues to debate extending jobless relief measures. There was some movement this week, but still no agreement. What will happen if we don't get a deal?
HORSLEY: If we don't get a deal, millions of jobless workers are about to lose their unemployment benefits right after Christmas. Now, this gloomy report may add some fresh urgency to those talks going on here in Washington, because it's clear that all the people who are out of work are not suddenly going to find jobs between now and the end of the year. In fact, a lot of forecasters say, with the case counts and hospitalizations soaring, December's jobs report could be worse than November's. Now, we do have, you know, promising news about these vaccines. And that offers hope for a much better economy in the spring or maybe the summer. But first, we have to get through this dark winter. And this report shows a lot of people are going to need help with that.
GARCIA-NAVARRO: A dark winter, indeed.
NPR's chief economics correspondent Scott Horsley. Thank you very much.
HORSLEY: You're welcome.
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