HOUSTON, Nov. 12, 2020 /PRNewswire/ -- After showing signs
of slowing in September, the unemployment rate plunged to 6.9
percent in October, down from 7.9 percent, driven by
disproportionately higher job gains in the household employment
survey, according to the latest economic analysis from the BBVA
Research team.
Industry-level job gains continue to be concentrated in the
service sector with nonfarm payrolls increasing 271,000 in leisure
and hospitality. According to the analysis, 58 percent of jobs lost
to the pandemic in leisure and hospitality have come back. However,
employment remains 3.5 million below pre-pandemic levels. Other
substantial gains occurred in professional business services,
retail trade and healthcare and social assistance. The report
further noted that improvement in economic activity and housing
demand have pushed up construction, transportation and warehousing,
and manufacturing employment over-the-month.
The analysis, co-authored by BBVA Chief Economist Nathaniel Karp and Senior Economist Boyd Nash-Stacey, highlights the reverse in
weekly hours declines from previous months, with all major
industries except education and healthcare reporting a gain.
Likewise, weekly earnings posted a solid 0.4 percent monthly gain,
implying a 4.7 percent increase in the last 12 months.
The report asserts that the employment report suggests labor
market conditions will continue to improve, albeit at a slower
pace. While the team's baseline assumes more modest gains in the
labor market going forward, the larger-than expected drop in the
unemployment rate suggests that it could fall below our current
baseline of 7.1% by the end of the year.
That being said, the risk balance is tilted to the downside with
an alarmingly high number of new Covid-19 cases, along with new
lockdown measures abroad and the massive amount of uncertainty
associated with the 2020 election, which could remain unresolved
for some time. Rising COVID-19 case numbers may also increase the
propensities of individuals to distance, regardless of whether
there are compulsory lockdown measures. Without additional fiscal
support, the analysis indicates that the risks of the labor market
backsliding in the 4Q20 will continue to grow.
BBVA USA's research team
analyzes the U.S. economy and Federal Reserve monetary policy. For
its analyses, the economists create models and forecasts for
growth, inflation, monetary policy and industries. The Economic
Research team also follows a variety of issues that affect the
Sunbelt states where BBVA USA
operates. Follow their work on Twitter @BBVAResearch and
@BBVANews_USA.
Read the full report here.
See the complete library of BBVA Research publications here.
For more BBVA news visit, www.bbva.com and the U.S.
Newsroom.
Additional news updates can be found via Twitter and
Instagram.
For more financial information about BBVA in the U.S., visit
bbvausa.investorroom.com.
About BBVA
BBVA Group
BBVA (NYSE: BBVA) is a customer-centric global financial services
group founded in 1857. The Group has a strong leadership position
in the Spanish market, is the largest financial institution in
Mexico, it has leading franchises
in South America and the Sunbelt
Region of the United States. It is
also the leading shareholder in Turkey's Garanti BBVA. Its purpose is to bring
the age of opportunities to everyone, based on our customers' real
needs: provide the best solutions, helping them make the best
financial decisions, through an easy and convenient experience. The
institution rests in solid values: Customer comes first, we think
big and we are one team. Its responsible banking model aspires to
achieve a more inclusive and sustainable society.
BBVA USA
In the U.S., BBVA is a Sunbelt-based financial institution that
operates 641 branches, including 330 in Texas, 89 in Alabama, 63 in Arizona, 61 in California, 44 in Florida, 37 in Colorado and 17 in New Mexico. The bank ranks among the top 25
largest U.S. commercial banks based on deposit market share and
ranks among the largest banks in Alabama (2nd), Texas (4th) and Arizona (6th). In the U.S., BBVA has been
recognized as one of the leading small business lenders by the
Small Business Administration (SBA) and ranked 8th nationally in
terms of dollar volume of SBA loans originated in fiscal year
2018.
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SOURCE BBVA USA