WSJ: Business Hit Hard by Pandemic Drive U.S. Jobs Recovery

Businesses Hit Hard by Pandemic Drive U.S. Jobs Recovery

Renewed demand spurs gains at logistics, financial-services and retail firms, but the coronavirus’s recent surge poses a threat

By: Eric Morath and Kim Mackrael

Employers hit hard by the coronavirus pandemic and businesses with renewed demand are driving hiring in the U.S. jobs recovery.

Businesses such as health-care providers and restaurants—which closed during pandemic lockdowns—have recalled millions of laid-off workers. Job growth has also been boosted by increased demand in a handful of industries such as logistics, financial services and retail, including at furniture stores.

Hiring jumped in May and June when employers added 7.5 million jobs to payrolls—the best two-month stretch on records back to 1939, according to the Labor Department. This week the total number of online job postings surpassed seven million for the first time since April, according to ZipRecruiter.

Still, gains in job openings flattened in July and are down from 11.4 million in February, and job gains are well short of replacing the 21 million jobs lost in March and April when the pandemic first hit. Recent labor-market readings—including the first increase in weekly jobless claims in nearly four months—also suggest the recovery’s momentum is threatened by the virus’s recent surge.

But employment gains in some pockets of the economy mean job seekers are finding new opportunities, which in turn could result in more people searching for work.

“Employment is still rising in July, but at a slower pace than in May and June,” said Conrad DeQuadros, economist at Brean Capital LLC. He said he expects to see job gains in industries such as construction and manufacturing, where social distancing is easier, and less of an increase at businesses dependent on public gatherings, such as restaurants and stores.

Health care and logistics are industries with high demand for new workers, according to ZipRecruiter. Since May 1, 18% of all new job postings have been in the health field and 15% have been in transportation and storage, a sector that is expanding as more consumers purchase goods online.

Capstone Logistics LLC, which operates nearly 560 warehouses across the U.S., has added about 1,500 employees to its staff of roughly 15,000 since the pandemic began.

Chief Operating Officer Rick Tomcho said business shutdowns resulted in significant changes in demand in the spring, with commercial food service dropping steeply—but temporarily—and grocery-related work rising sharply.

“We’ve been hiring like crazy,” Mr. Tomcho said. “I don’t see anything that tells me that this volume is going to subside.” He said the company’s average workload volume across all of its warehousing operations and industries is up about 8% from last year.

ZipRecruiter labor economist Julia Pollak said overall hiring is likely to outpace layoffs, despite the rise in coronavirus cases in several states. She expects total payrolls to continue to grow this summer, though at a slower pace than the spring.

“Those gains are entirely accounted for by businesses recalling workers on temporary layoffs,” she said, adding that activity isn’t typically reflected in job postings because employers don’t post jobs to be filled by laid-off employees.

Health-care employment, particularly jobs at doctor and dentist offices, has experienced strong hiring in recent months, after a sharp decrease. Employment at dentist offices has more than doubled since a low point in April, the fastest growth of any sector tracked by the Labor Department.

Dental365, a chain with 46 locations in the New York City area, laid off more than 400 of its 600-person staff in March when the offices closed for nonemergency work, Chief Executive Scott Asnis said. But business was steadier than he expected this spring because hospitals and urgent-care centers referred emergency patients in need of dental care. Dental365 reopened all of its offices in June and has recalled most of its staff, he said.

“I was shocked how busy we were,” Dr. Asnis said. “I told the staff, ‘Come on back, see how safe it is’ because we have a responsibility to serve our patients.”

Write to: Eric Morath at and Kim Mackrael at