The number of US workers on temporary layoff dropped 31% in June

Before the coronavirus picked up, it was the American jobs market that was rebounding.

The US unemployment rate fell from 13.3% in May to 11.1% in June, still far off the low of 3.5% in March but better than forecast. Payrolls swelled by 4.8 million, and the number of workers on temporary layoff declined by almost 5 million, or 31%, to about 11 million.

Compared with May, when the number of workers on temporary layoff fell by just 15%, the June data suggests signs of recovery and that “workers are being recalled to their jobs in large numbers,” says Julia Pollak, a labor economist at ZipRecruiter.

Still, there is a long way to go for a job market recovery. Permanent job losers—i.e. those whose employment ended involuntarily and who began looking for work—rose 26% in June to 2.9 million.

The new numbers were collected in mid-June, before the recent surges in virus cases and, in some states, the resulting sudden shutdowns of restaurants and retail stores that were slowly re-opening across the US.

Workers on temporary layoff were already in a precarious state, and now there’s the risk that recalled workers could be laid off again, which is already happening in some parts of the country.

One study estimates that 42% of the recent US layoffs, including furloughs, will result in permanent job losses due to reduced demand and concerns about further transmission of Covid-19.