NFP: Never seen before – BMO

The jobs report from hell is here, one never seen before and unlikely to be seen again barring another pandemic or meteor hitting the earth, as Sal Guatieri from the Bank of Montreal notes.

Key quotes

“The damage: 20.5 million Americans fell off payrolls in April, more than twice as many as in the entire Great Recession.”

“Only a 6.4 million drop in the labour force prevented the unemployment rate from rising more, though it still hit a post-war high of 14.7% while the more inclusive U6 rate that accounts for involuntary part-time workers and discouraged workers hit 22.8% versus 8.7% in March.” 

“The next jobs report for May could see further losses, albeit likely a fraction of those reported in April, given that it will largely capture just the early stage of reopenings.”

“Even with an expected strong rebound in GDP growth in the third quarter, the unemployment rate could still be sitting around 7% at the end of the year, double the half-century low of 3.5% achieved before the pandemic.”