Jobs report shows even early March saw severe economic damage from COVID-19
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By the second week of March, there was already significant damage from COVID-19, according to the latest monthly surveys of employers and households from the Bureau of Labor Statistics. In other words, even before 10 million Americans filed for unemployment benefits as school and business closures spread, things got grim. And this is just a down payment on the pain to come.
Payrolls fell by 701,000, and the unemployment rate rose 0.9% to 4.4%. That’s the biggest one-month rise in unemployment since 1975. The economy has only ever lost more jobs in a month after World War II, and at the worst point of the Great Recession.
Both the number of workers who bumped down to part-time and the number of workers who have left the labor force entirely soared.
Again, both total job losses and the unemployment rate are surely already much higher than this report shows.
About two-thirds of the drop in jobs occurred in leisure and hospitality, mainly in food services and drinking places. Notable employment declines also occurred in health care and social assistance, professional and business services, retail trade and construction.
The Bureau of Labor Statistics cites numerous reasons its counting is likely off because of the pandemic. Fewer households and businesses responded to surveys than usual, survey-takers were working remotely and workers on furlough might be counted as “still employed.”
Just before the COVID-19 pandemic broke out in the U.S., the job market was cooking. Unemployment was at 3.5%, a 50-year low. And employers were adding nearly 250,000 jobs a month.
Economists are already making dire predictions for April’s report. With an unprecedented 10 million unemployment claims filed nationwide over the past two weeks, the unemployment rate could already be above 10% —the highest it got during the Great Recession.
COVID-19 Economy FAQs
How many people are flying? Has traveled picked up?
Flying is starting to recover to levels the airline industry hasn’t seen in months. The Transportation Security Administration announced on Oct. 19 that it’s screened more than 1 million passengers on a single day — its highest number since March 17. The TSA also screened more than 6 million passengers last week, its highest weekly volume since the start of the COVID-19 pandemic. While travel is improving, the TSA announcement comes amid warnings that the U.S. is in the third wave of the coronavirus. There are now more than 8 million cases in the country, with more than 219,000 deaths.
How are Americans feeling about their finances?
Nearly half of all Americans would have trouble paying for an unexpected $250 bill and a third of Americans have less income than before the pandemic, according to the latest results of our Marketplace-Edison Poll. Also, 6 in 10 Americans think that race has at least some impact on an individual’s long-term financial situation, but Black respondents are much more likely to think that race has a big impact on a person’s long-term financial situation than white or Hispanic/Latinx respondents.
Find the rest of the poll results here, which cover how Americans have been faring financially about six months into the pandemic, race and equity within the workplace and some of the key issues Trump and Biden supporters are concerned about.
What’s going to happen to retailers, especially with the holiday shopping season approaching?
A report out recently from the accounting consultancy BDO USA said 29 big retailers filed for bankruptcy protection through August. And if bankruptcies continue at that pace, the number could rival the bankruptcies of 2010, after the Great Recession. For retailers, the last three months of this year will be even more critical than usual for their survival as they look for some hope around the holidays.
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