Massachusetts set two labor statistics records in June when employers added 83,700 jobs, the biggest monthly gain ever, and the unemployment rate soared to a nation’s highest 17.4 percent.
The diverging trends, which are not uncommon because labor officials track each figure based on a different survey, reflect signs of renewed economic activity in the state after months of forced business shutdowns and also enormous strain on workers that has not abated even as some jobs return.
In June, the state’s unemployment rate rose 0.8 percentage points over the revised May figure to a highest-in-the-nation 17.4 percent, according to federal data published Friday.
Both the unemployment rate and monthly employment increases were the highest since at least 1976, when the federal government started the state-level data series.
Massachusetts was one of only five states where the unemployment rate increased last month, and its rate sits 6.3 percentage points above the national level for the same month.
The COVID-19 pandemic’s impact has been swift and severe: As recently as March, the month when confirmed infections began rising rapidly and Gov. Charlie Baker declared a state of emergency, Massachusetts had an unemployment rate of just 2.8 percent.
June’s data reflect the first full month during which businesses in the state were allowed to resume in-person operations after months of forced shutdowns, albeit on a phased basis.
In that span, employers added jobs at a never-before-seen clip, surpassing the revised May record by more than half.
All major private-industry categories in Massachusetts except financial activities and information added jobs in June, combining for a total increase of 97,300. The largest increases came in two fields most acutely impacted by the intertwined public health and economic crises: leisure and hospitality added 29,500 jobs, an 18.8 percent increase, while construction added 19,700 positions, a 16.3 percent increase.
Government employers shed 13,600 employees in June, which could be the first wave in a trend. Economists have warned for months that state and local governments may need to impose strict spending cuts to close enormous budget gaps ripped open by plummeting tax revenues.
While the state has experienced two subsequent months of massive gains, the May and June increases together brought back less than one-fifth the revised total of 811,000 jobs cut in April, when the COVID-19 crisis shut down big parts of the economy.
All 50 states saw net increases to overall nonfarm employment in June, according to federal data.
Only eight other states reported June unemployment rates in the double digits. New Jersey had the second-highest rate behind Massachusetts at 16.6 percent, followed by New York at 15.7 percent, Nevada at 15 percent, Connecticut at 14.9 percent and Michigan at 14.8 percent.
The record levels of need have created enormous strain on the state systems that provide jobless aid. Between Feb. 29 and May 31, the balance of the Massachusetts unemployment insurance trust fund dropped from almost $1.63 billion to $733 million, according to state records.
Baker administration officials expect the fund to fall into a $3.1 billion deficit by the end of 2020 and a $6.1 billion deficit by the end of 2021, and they plan to increase taxes that businesses pay toward unemployment insurance by up to 65 percent in the next few years.
Many of those receiving benefits from the state also face a forthcoming increase in pressure with the federally funded additional $600 per week offered through the CARES Act set to expire on July 31.
