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BusinessJune 2021 Jobs Report: Delta Variant Could Complicate Reopening...

June 2021 Jobs Report: Delta Variant Could Complicate Reopening Plans

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The trajectory of the American economy will come into clearer view Friday morning when the government reports on hiring and unemployment in July.

Economists are looking for a gain of more than 800,000 jobs, but the data was collected in the first half of last month, before coronavirus cases caused by the Delta variant surged in many parts of the country.

While the economy and job growth overall have been strong in recent months, experts fear that the variant’s spread could undermine those gains if new restrictions become necessary. Already, some events have been canceled and many companies have pulled back from plans for employees to return to the office in September.

“A lot hangs on this report,” said Scott Anderson, chief economist at Bank of the West in San Francisco. “It’s been a sprint in terms of growth, but we may be moving into more of a marathon. Travel season is winding down, and the Delta variant is a big concern.”

A consensus of economists polled by Bloomberg is calling for a gain of 858,000 jobs, with a drop in the unemployment rate to 5.7 percent from 5.9 percent in June. Still, there is a wide range of estimates, from below 500,000 to more than one million hires.

One source of strength in the July figures is expected to be education, with schools gearing up after being shuttered in some cases since the pandemic hit.

Local governments added 155,000 education jobs in June, and July’s increase could be even bigger as more teachers are hired, according to Lydia Boussour, senior U.S. economist at Oxford Economics. Leisure and hospitality should also show strong growth, she said.

“The labor market outlook remains quite positive heading into the second half, but what happens on the virus front will be key to watch in terms of downside risk,” Ms. Boussour said.

Growth is expected to be more moderate in the manufacturing and construction industries, both of which have been held back by supply shortages, including high prices for lumber and a lack of semiconductors for automakers. “It would be nice to see some progress, but we don’t expect a surge there,” said Nick Bunker, director of economic research at the hiring site Indeed.

Despite the hiring gains, many managers report difficulty in finding applicants for open positions. Jeanine Lisa Klotzkin manages an outpatient addiction treatment center in White Plains, N.Y., and has had only limited success in her search for addiction counselors.

“Normally, we’d have dozens of candidates,” she said. But six weeks after posting an online job ad, her clinic has received four applications. The positions pay $50,000 to $63,000 a year, said Ms. Klotzkin, who added: “These aren’t low-wage jobs. I don’t know where the people went.”

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