Oh joy, another day when our elected leaders speak about us as percentages rather than people.
We are 6 months into the COVID-19 pandemic and 6 months into an economic recession.
Inequality is widening in America.
The economy has so far recovered less than half of the 22 million jobs that were lost this spring. There are still 11.5 million fewer jobs than there were pre-pandemic.
As of August 15, more than 29 million people were collecting some form of unemployment benefits. That includes millions of gig workers and self-employed people who are not recorded in the monthly payroll count. That figure was up more than 2 million from the previous week.
Today's BLS report indicates that payroll employment increased by 1.4 million jobs in August.
This indicates a slowdown in the recovery of the economy, as the increase was 1.7 million jobs in July and 4.8 million jobs in June. This slowdown is likely tied directly to the slowdown of government support as pieces of the CARES Act dwindled and expired in July.
According to the EPI, "With this kind of slowing in job growth, it will take years to return to the pre-pandemic labor market. And, without the $600 boost to unemployment insurance, jobs will return even more slowly than had policymakers stepped up and continued that vital support to workers and the economy."
A significant chunk of the employment increase was temporary work. Without Census workers, the jobs deficit would be 11.8 million. And ONE FOURTH of the employment gains were part-time workers. People cannot survive on part-time work. Putting people to work in jobs that they cannot afford to live on is not indicative of a recovering economy.
While gaining some of this temporary work, the economy saw an increase of over half a million permanent job losses in August.
And more permanent job loss is looming if there is not a pandemic relief package passed. American and United Airlines alone have warned over 60,000 employees that their jobs may be cut if relief is not extended. This is indicative of a great danger throughout the economy as both PPP and PSP programs run out.
Some of the increase in jobs is because the lack of the $600 is forcing people back into jobs that are not safe. Cruelty "wins" again in America.
Industry Disparity
In a report yesterday, the US Chamber of Commerce demonstrates that the current economic recovery is hitting parts of the economy and workforce in starkly different ways resulting in a "K-Shaped Recovery". Tech, some retail, and software services climb, because their workers are largely able to work from home and they are developing new products that are skyrocketing in this current social climate. But travel, hospitality, entertainment, and food services continue to decline. The layoffs in those sectors come the hardest and the fastest for those least able to survive prolonged joblessness, creating a cascade of setbacks from which it will be hard to recover.
And A Whole New System
The unemployment rate dropped to 8.4% and there were 881,000 new claims filed. Continued claims are up 2 million.
Some are comparing these numbers to the July report when the rate was 10.2% and over 1 million new claims were filed, but the comparisons can’t be made because mid-pandemic, they have decided to change how the unemployment data is calculated.
This new way of calculating, while more accurate, makes this current month look like a significant change when it is not that severe. They did not go back and recalculate the past numbers so this month's report is not comparable to those from previous months.
According to NPR, without the seasonal adjustment, state unemployment claims actually rose by more than 7,500. In addition to the state unemployment claims, 759,000 people who are not eligible for UI applied for PUA benefits.
Don’t forget that these numbers leave many out
As we've discussed before, the unemployment rate is not counting all coronavirus-related job losses. It does not calculate people who may be temporarily unemployed and people who were dropped from the labor force numbers altogether because they were "not actively seeking work" (due to the virus). This is over 7 million people. With those people counted, 19 million workers were unemployed due to the virus in August and that is 11.5% according to the EPI.
Unemployment numbers do not count the millions of people who are currently underemployed.
Racial Disparity
Racial disparities are only growing. According to Michele Evermore at NELP, the unemployment chasm between Black and white workers continues to move back to double the unemployment for Black workers, and according to EPI, by August, Black men have recovered the least and still have an unemployment rate of 13.2%.
Gender Disparity
Gender disparities are also growing.
The National Women’s Law Center points out:
-Women gained just 800,000 jobs in August, compared to 1.1 million in July.
-More than 1 in 10 Black women (12.0%) and Latinas (10.5%) are still unemployed, compared to only 6.9% of white men.
-Almost 1 in 7 (14.2%) women ages 20-24 are still unemployed.
-In August, the unemployment rate for women with disabilities was 16.3%, which is over twice as high as it was in February.
-And the labor force change is much the same K-Shape between genders, as we saw before with industries.
Men 20+: +608,000
Women 20+: -5,000
Chart by economist Michael Madowtiz, referencing this BLS data.
TLDR?
Everything points to a need for continued pandemic relief from the government for us to survive this as individuals, small businesses, and as a national economy.