The last jobs report for 2020 is out Friday morning, and the results are not good. The U.S. economy actually lost 140,000 jobs in December instead of making modest gains as forecasted. It’s the first month of job losses since April 2020, interrupting a recovery.
But, with vaccines slowly starting to roll out, and the money from the recent $900 billion COVID relief package starting to make its way into the economy, could we start seeing some better jobs news in January?
The short answer is not yet. The biggest reason is that the U.S. is still setting records for new COVID infections and deaths.
“I think that that’s the biggest determinant, frankly. What’s the virus doing?” said Erica Groshen, an economist at Cornell University.
Groshen said that as long as so many people are staying home, we just aren’t going to see a lot more rehiring or new jobs.
“We’ve sort of reached a plateau, I would say, that is not going to look a lot better until the vaccine reaches a whole lot more people,” she said.
In the meantime, the latest COVID relief package will have a positive effect on the economy as soon as this month, said Heidi Shierholz, at the Economic Policy Institute.
“Without that stimulus package, over 10 million people would have lost unemployment insurance benefits at the end of December,” Shierholz said. “That would have been a huge drag on the economy that we will not see.”
And, with the Democrats soon to be in charge, Shierholz said there is likely more relief on the way.
COVID-19 Economy FAQs
What are the details of President Joe Biden’s coronavirus relief plan?
The $1.9 trillion plan would aim to speed up the vaccine rollout and provide financial help to individuals, states and local governments and businesses. Called the “American Rescue Plan,” the legislative proposal would meet Biden’s goal of administering 100 million vaccines by the 100th day of his administration, while advancing his objective of reopening most schools by the spring. It would also include $1,400 checks for most Americans. Get the rest of the specifics here.
What kind of help can small businesses get right now?
A new round of Paycheck Protection Program loans recently became available for pandemic-ravaged businesses. These loans don’t have to be paid back if rules are met. Right now, loans are open for first-time applicants. And the application has to go through community banking organizations — no big banks, for now, at least. This rollout is designed to help business owners who couldn’t get a PPP loan before.
What does the hiring situation in the U.S. look like as we enter the new year?
New data on job openings and postings provide a glimpse of what to expect in the job market in the coming weeks and months. This time of year typically sees a spike in hiring and job-search activity, says Jill Chapman with Insperity, a recruiting services firm. But that kind of optimistic planning for the future isn’t really the vibe these days. Job postings have been lagging on the job search site Indeed. Listings were down about 11% in December compared to a year earlier.
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