Key Takeaways:
1.94 million Americans were long-term unemployed in August, the most since November 2021.
The share of workers jobless for 27+ weeks rose to 26.3%, higher than in all past recessions except 2008 and 2020.
Non-farm payrolls (excluding healthcare) have dropped by 142,200 jobs in four months, the steepest decline since 2020.
The US labor market is showing signs of deeper weakness as long-term unemployment climbs at its fastest pace in years, according to analysis from TheKobeissiLetter cited by BlockBeats.
The number of Americans unemployed for 27 weeks or longer surged to 1.94 million in August, marking the highest level in nearly three years. Since December 2022, this figure has more than doubled, pushing the share of long-term unemployed to 26.3% of total joblessness — a level only surpassed during the 2008 financial crisis and the 2020 pandemic recession.
Meanwhile, the broader job market is weakening beyond healthcare, which has been the only sector consistently adding jobs. Over the past four months, the US has lost 142,200 jobs excluding healthcare, with payroll declines of -53,000 in May, -71,800 in June, and -24,800 in August. Analysts note that such a rapid employment downturn after years of steady growth has historically coincided with the start of recessions.
Private-sector employment contraction adds to concerns that the US economy may be significantly weaker than headline labor data suggests, raising pressure on the Federal Reserve ahead of its next rate decision.