The U.S. labor market added 2.5 million jobs in May, the Bureau of Labor Statistics announced, surprising many who forecast another terrible month as the economy – broadly shut down in an effort to contain the coronavirus pandemic – limps back to life.
The unemployment rate dropped to 13.3% from 14.7% in April.
“These outcomes are huge surprises relative to expectations for several million more jobs lost and another large increase in the unemployment rate,” wrote JP Morgan analyst Michael Feroli.
While the slow reopening of the U.S. economy gets credit for the historic job gains, the Independent Restaurant Coalition warns that the employment gains are fragile.
Food services and drinking places accounted for half of the job gains in May, but employment only rose by 1.4 million. Restaurants and bars, among the businesses hit hardest by the coronavirus shutdown, lost 6.1 million jobs in March and April.
“I have not hired a single person back,” Amanda Cohen, chef and owner of Dirt Candy, a restaurant in New York City, told Yahoo Finance. Cohen is on the advisory board of the IRC, and is trying to help Dirt Candy and other restaurants survive the economic downturn.
The IRC has called for the implementation of a $120 billion restaurant stabilization fund to ensure that the path to recovery is sustainable and restaurants have the funds they need to operate at reduced capacity as a social distancing measure.
“Restaurant workers continue to make up the largest share of America’s jobless,” the IRC said in a statement. “Congress needs to pass a relief package specifically designed to protect our industry. Some independent restaurants are able to reopen, but the odds of staying open have grown nearly insurmountable. Restaurant owners face massive losses in revenue due to social distancing guidelines and increasing costs of supplies, and risk being forced to close again at any time.”
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