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COVID & Unemployment

Jobs report reveals alarming level of long-term unemployment

Kimberly Adams Feb 5, 2021
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A new study predicts it will take women and people of color an extra two years to reach pre-pandemic employment levels. Saul Loeb/AFP via Getty Images
COVID & Unemployment

Jobs report reveals alarming level of long-term unemployment

Kimberly Adams Feb 5, 2021
Heard on:
A new study predicts it will take women and people of color an extra two years to reach pre-pandemic employment levels. Saul Loeb/AFP via Getty Images
HTML EMBED:
COPY

The Labor Department’s technical definition of “long-term unemployment” applies to someone who’s been jobless for 27 weeks or longer — a bit more than six months.

In the January jobs report, that was 40% of unemployed folks. That’s not even taking into consideration the people who’ve just given up and left the labor force altogether.

What are the long-term effects of long-term unemployment?

Early in the pandemic, there were lots of temporary job losses. Businesses were shut, temporarily. People were furloughed, temporarily, and would hopefully get back to work, eventually.

But now, 4 million people are suffering with long-term unemployment.

“That is exactly double what it was in January of 2020. So, the economy, in my view, is really stuck in a rut right now,” said Carl Van Horn, professor of public policy at Rutgers. He said unemployed people are stuck in a rut as well, due to “employment scarring,” in which the longer someone goes without a job, the harder it is to get a job.

“Because employers tend to stigmatize them. Even though we all know that most of these people lost their job totally without any fault of their own. They didn’t do anything wrong, they were just caught up in this economic change,” Van Horn said.

And certain groups were caught up more than others: women and Black and Latinx people.

“Workers tend to be displaced in really discriminatory ways. And then they’re also going to face hiring discrimination on the other end. It’s going to be even harder for them to go back to work,” said Kate Bahn, the director of labor market policy at the Washington Center for Equitable Growth.

A study out this week from McKinsey predicts inequities in the labor market mean it will take women and people of color an extra two years to reach pre-pandemic employment levels.

Kweilin Ellingrud, who headed the study, said the pandemic has also sped up technological developments that make some lower-wage jobs obsolete. “And when you bring both COVID and automation together, you have a real acceleration and a much more slow rebuilding of jobs in the U.S. economy,” she said.

Plus, Ellingrud said, when people are out of work a long time, they often just take whatever job they can get, even if it’s not a good fit or pays less than they used to make, which can decrease wages in the future and worsen stress and other mental health issues.

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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