U.S. businesses takes a down turm as it experience a slash on 20.2 million jobs in April, due to coronavirus outbreak closing the offices, factories, schools, construction sites and stores that propel the U.S. economy.
Reports from Automatic Data Processing ADP showed the drastic drop in scale of job losses that left no part of the world’s largest economy unscathed. The losses will likely continue through May, with a recovery in hiring likely to begin in the months that follow, said Mark Zandi, chief economist at Moody’s Analytics.
“This is one for the record books,” Zandi said. ”The good news is that we’re at the apex of the job loss.”
Zandi expects jobs to resume in June, as states have eased the lockdown, but he warns that it will be a “slog” for many years to recover all jobs lost in April.
The private industry report comes two days ahead of the official monthly job figures from the U.S. Labor Department. Economists believe the Friday report will reveal unemployment in the U.S. stands at a shocking 16%, up from 4.4% in March.
According to ADP, the leisure and hospitality sector shed 8.6 million workers last month. Trade, transportation and utilities let 3.4 million people go. Construction firms cut nearly 2.5 million jobs, while manufacturers let go of roughly 1.7 million people.
The health care sector cut 1 million jobs, but education services eked out a gain of 28,000 as colleges and universities do not appear to have forced significant layoffs that could come later this year.More than half of April’s job losses came from smaller companies with 500 workers or fewer. But larger employers cut 8.9 million jobs.
Polling by The Associated Press and NORC Center for Public Affairs Research indicates that nearly eight in 10 households that suffered job losses expect to return to their previous employer.