Economists Anticipate Record Job Growth in 2021

Economists Anticipate Record Job Growth in 2021

Wall Street Journal (01/10/21) Morath, Eric

The economy is expected to add more jobs this year than any other on record dating back to 1939. Nonfarm payrolls will increase by 6.7 million by December 2021, from last month, according to data firm IHS Markit. Economic forecasting firm Oxford Economics forecast 5.8 million jobs, while economists at the University of Michigan say the U.S. will add 5.3 million jobs. The projections are well ahead of the 4.3 million jobs created in 1946, at the start of the post-World War II expansion. However, in percentage terms, it would be 5%, compared with 11% in 1946.

Job growth is unlikely to fully replace job losses last spring. Hiring is likely to start slowly and pick up later in 2021, according to economists. Consumer services should see a boom in employment later in the year, says Oxford Economics’ U.S. chief economist Gregory Daco. Economists have varied views on the unemployment rate. IHS Markit forecasts the rate will drop to 4.3% by the end of this year, while other economists expect the rate to stay closer to 6%.

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