Washington (Associated Press)-Ten months after the virus outbreak in the United States, low-income workers still bear the brunt, an unusual and severe feature of the pandemic recession that flattened the economy last spring.
Last December, the United States was unemployed for the first time since April.. The layoffs are again concentrated in the industries that suffer the most, because they involve the kind of face-to-face contact that is now almost impossible: restaurants, bars and hotels, theaters, stadiums and concert halls.
With the virus changing consumer spending habits, economists believe that even after the economy regains its footing, some parts of these services will not return. This trend may further exacerbate economic inequality and prevent millions of families from buying food or paying rent.
Usually, during a recession, layoffs will hit a wide range of industries, including those that employ high- and middle-income workers and those that employ low-paid workers, because anxious consumers will cut spending significantly. Economists worry that the same trend will occur this time.
Instead, most other parts of the economy are recovering, even if slowly and healthy. Since May, although the factory has not fully recovered, it is still adding products and adding jobs every month. Home sales have skyrocketed by 26% from a year ago, as wealthy individuals who can work at home are looking for more space. This trend in turn has strengthened high-paying jobs in the banking, insurance and real estate sectors.
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On the surface, the government’s December employment report released on Friday was disheartening: the economy lost 140,000 jobs. This is the sixth consecutive month that the number of hires has decreased from the previous month. The unemployment rate remains at a high level of 6.7%.
However, the negative number comes entirely from brutal losses-nearly 500,000 jobs-and this category includes restaurants, bars, hotels, casinos and entertainment venues.
State and local governments have also laid off staff. The same goes for hair salons and other personal services. There are also layoffs in education.
Almost all other industries have added jobs. The construction industry increased by 51,000 and financial services increased by 12,000. The beneficiaries of the surge in e-commerce and delivery services during the pandemic are transportation and warehousing companies, which have increased their number by nearly 47,000.
Hershbein said in an interview that unemployment is definitely “definitely concentrated in certain industries, much worse than previous recessions.”
Once the coronavirus vaccine is more widely distributed, and the latest government assistance program Oil is being injected into the economy, and most analysts expect the economy to begin a strong recovery this summer. The incoming Biden administration, as well as the House and Senate now led by Democrats, will also likely promote other rescue aid and spending measures to accelerate growth.
Economists pointed out that the government’s $2 trillion aid package in March, including generous unemployment benefits and assistance to small companies, played a role in preventing the spread of layoffs beyond many analysts’ expectations.
However, a huge unknown factor looms over the economy in 2021: Will the economic recovery be fast enough and strong enough to absorb many Americans who have lost their jobs in the hotel industry and enable them to enter a more flexible job market?
Currently, the outbreak of the pandemic has made consumers reluctant to shop, travel, dine and gather in crowds, and has caused states and cities to impose stricter restrictions on restaurants and bars.
This trend changed the lives of Brad Pierce and others in West Warwick, Rhode Island. Pierce gradually became a comedian, but later came to the fore due to epidemics and restrictions on bars.
Now, he wants to know if that life will come back again. Even if the bars where Pierce works are reopened, they will not be able to provide live entertainment due to coronavirus restrictions. He is worried that some of these places will not survive.
Pierce receives about $500 a week in unemployment benefits, and his wife is still a medical technician-busier than ever because she manages COVID-19 testing. Although he felt lucky financially, this contrast sometimes frustrated him.
“She has been working, but I can’t work. As a husband and spouse, it’s really a terrible feeling,” said Pierce, 40.
At the same time, there are his performances everywhere. The weirdest thing is his standing procedure when attending a company holiday party through Zoom. He asked employees to unmute the sound so that they could hear their laughter, but was moved by the harsh sound of dogs barking, children yelling and the roar of the TV.
He spent the rest of the show looking at the silent lips of the audience to see if they were smiling.
Pierce said: “I have a few days I will be back, and a few days I think,’Well, I think I will never work again.’
Hershbein and Holzer’s research found that the unemployment rate of black and Hispanic workers is higher than that of whites, and it is also more pronounced for people in low-paying jobs. Hershbein found that since February of this year, the employment rate of the lowest-income quarter of Americans has fallen by nearly 12%. In the highest revenue quarter, the decline must be less than 3.5%.
Since the pandemic, the percentage of white Americans with jobs has fallen by 6%; Hershbein said that among blacks and Hispanics, the percentage has fallen by 10%. This means that as part of the pandemic job losses become permanent, non-white workers suffer the most.
Michelle Holder, an economist at John Jay College, points out that the two biggest causes of unemployment for black women are cashiers in shops and restaurants, including fast food restaurants and nurseries. She said she is worried that even if certain changes in the economy become permanent and the epidemic subsides, many jobs may not return.
With more remote meetings going on, business travel is unlikely to return to the previous level. Many medical appointments are now made online, reducing the need for some staff in the doctor’s office. Considering that many low-paying jobs are a high proportion of black workers, this may end the decade-long narrowing of the unemployment gap between black and white.
Holder said: “In our workplace, there will be major changes in what jobs will be available.” “All of this will hit women, low-paid workers and people of color.”
As the pandemic recession intensifies, more small businesses are forced to close. This trend may drag down the job market for a long time, because new companies must be established to absorb many laid-off workers.
David Gilbertson, the vice president of UKG, a company that produces employee time management software, said that among his company’s customers, 13% of companies with fewer than 100 employees in March had Bankruptcy, which is more than twice that of a typical year. Another round of small business loans included in the $900 billion aid package approved last month is critical to preventing another wave of closures.
He said: “They have done this, and now they are on the verge of having to shut down.”
At the same time, the struggling unemployed include those in independent professions, such as Bryan Blew, who quit their job as an equipment repairman in Kansas City a year ago to become Las Vegas. Full-time musician. Before the pandemic, Blew usually played bass guitar in bands in casinos, bars and other venues several nights a week. He is not sure whether the Vegas music industry will return to its original state.
Blew, who has never participated in a concert since March, is now fighting whether to give up the hope of rebuilding his music career. Currently, he is a delivery man in a sandwich shop and earns $9 an hour. He will receive unemployment benefits, depending on his work income during the week.
46-year-old Bligh said: “Time has proved my guess. It’s hard to swallow.”
Olsen reports from New York.