Goldman Sachs: US job market is recovering

The US jobs market is recovering despite the harrowing damage caused by the ongoing coronavirus pandemic, according to Goldman Sachs economists.

In a note to clients, Goldman economists – led by Jan Hatzius – said that the decline in jobless claims weekly makes them believe the job market is on the rebound with economies reopening across the country, Fox News reported.

The report noted how more than 40 million Americans lost their jobs, according to the Labor Department, but jobless claims reached the lowest total since mid-March, continuing the declining trend for the eighth straight week.

Despite the favorable drop in jobless claims, Goldman economists said it could send “mixed signals” regarding unemployment in the US since it remains murky until rehiring begins.

“We continue to expect a fairly rapid decline in the second half, partly because most newly unemployed workers are on temporary rather than permanent layoff,” an economist wrote. “However, Congress is likely to enact changes to the Paycheck Protection Program that look set to weaken rehiring incentives.”