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
So what’s up with “Zoom fatigue”?
It’s a real thing. The science backs it up — there’s new research from Stanford University. So why is it that the technology can be so draining? Jeremy Bailenson with Stanford’s Virtual Human Interaction Lab puts it this way: “It’s like being in an elevator where everyone in the elevator stopped and looked right at us for the entire elevator ride at close-up.” Bailenson said turning off self-view and shrinking down the video window can make interactions feel more natural and less emotionally taxing.
How are Americans spending their money these days?
Economists are predicting that pent-up demand for certain goods and services is going to burst out all over as more people get vaccinated. A lot of people had to drastically change their spending in the pandemic because they lost jobs or had their hours cut. But at the same time, most consumers “are still feeling secure or optimistic about their finances,” according to Candace Corlett, president of WSL Strategic Retail, which regularly surveys shoppers. A lot of people enjoy browsing in stores, especially after months of forced online shopping. And another area expecting a post-pandemic boost: travel.
What happened to all of the hazard pay essential workers were getting at the beginning of the pandemic?
Almost a year ago, when the pandemic began, essential workers were hailed as heroes. Back then, many companies gave hazard pay, an extra $2 or so per hour, for coming in to work. That quietly went away for most of them last summer. Without federal action, it’s mostly been up to local governments to create programs and mandates. They’ve helped compensate front-line workers, but they haven’t been perfect. “The solutions are small. They’re piecemeal,” said Molly Kinder at the Brookings Institution’s Metropolitan Policy Program. “You’re seeing these innovative pop-ups because we have failed overall to do something systematically.”
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