Because of the pandemic, millions of Americans have found themselves jobless and seeking financial support from the government. Since mid July to early August, however, the unemployment rate in America has slowly begun to bounce back to what it used to be. According to CNBC, at it's peak during the coronavirus, almost 7 million Americans claimed unemployment insurance from the government. However, currently only 837,000 people are. Thus, it is apparent that many people are beginning to get their jobs back. Where are these jobs coming from, though? Many business closed down, which one would assume reduces the number of job openings. According to the Bureau of Labor Statistics, in their October 2 report of September's employment records, 661,000 people became employed in September, reducing the unemployment rate to 7.9%. At the peak of the pandemic, the unemployment rate was at roughly 11%. According to the BLS, the number of people who have been unemployed long-term because of the virus has drastically risen. However, most recently unemployed citizens have found jobs again in September, which they attribute to the reopening of many public dining and recreational spaces. They found that the most jobs were regained in the recreational industry, with 661,000 Americans finding their jobs within that sector. Despite this seemingly great news, the New York Times has a different take on the decreasing unemployment rates.
The New York Times cites the decreased rate of lowering of the unemployment rate as proving that the United States isn't popping back up out of the unemployment crisis as quickly as hoped. According to the New York Times, "Six months after the coronavirus pandemic tore a hole in the U.S. economy, the once-promising recovery is stalling, leaving millions out of work, and threatening to push millions more — particularly women — out of the labor force entirely...The latest evidence came Friday, when the Labor Department reported that employers added 661,000 jobs in September, far fewer than forecasters expected" (New York Times). The lower real number of re-employed people compared to the predicted number of jobs is a cause for concern. However, there are several reasons on why this isn't as terrible as the New York Times makes it sounds. Firstly, the NYT did not provide any hard numbers on what the expected number of people who would go back into the labor force during September would be. We also did better in August than expected according to the Bloomberg Median Forecast (provided by the Whitehouse - see below), so one possibility is that it is a setback from the lowered job availability after more had been taken in August. Another thing to consider is that projections regarding a full state of normalcy are constantly being pushed back. Until we are entirely back to full international participation, our economy is going to suffer and the unemployment rate will be uncharacteristically high. The fact that we were able to regain so many jobs in the first place in such a short time period is an achievement itself. Overall, although some argue that the reduction unemployment rate is too slow, it is clear that our consistent decrease in unemployment shows promise for a more stable economy within the United States.
Guiding question in case anyone wants one: do you agree that the economy is coming back well, or do you side with the argument that our decrease in unemployment is too slow?
Source 1: CNBC
Source 2: Bureau of Labor Statistics
Source 3: New York Times
Extra Source for Image (1): National Observer
Extra Source for Image (2): The Whitehouse
4 comments:
Personally I'm hopeful for the continued resurgence of the economy, and I think that it's going fairly well overall. Having such a reduction in the unemployment rate is always going to be good, despite what the Times claims, and it's a huge improvement from the peak months of the pandemic. Additionally, as the unemployment rate continues to decrease, the economy will improve as well, creating more jobs and decreasing unemployment even further. And although the end of the pandemic restrictions is probably still many months away, the lifting of those rules will massively benefit the economy. Though there are a lot of people going out to restaurants and stores right now, I believe that once the restrictions are lifted that number will increase exponentially, which will boost the economy more than what we have currently.
Considering we are still in a pandemic with increasing cases and deaths weekly, I think it’s better to slowly inch ourselves back into rebuilding our economy. As seen in the effects of COVID-19, small businesses like restaurants and small stores were one of the populations hit the hardest. Many seem to be unrecoverable and have decided to shut down due to lack of funds to support and sustain future reopening. The unemployment numbers don’t include those who choose to leave the workforce permanently, with nearly “6.6 million who have dropped out of the labor force” as of June 2020 due to the virus. As Liam has mentioned, I think it’s better to stay safe than sorry, especially when the pandemic is still ongoing with no set vaccine for distribution yet in the near future.
https://www.epi.org/blog/nearly-11-of-the-workforce-is-out-of-work-with-zero-chance-of-getting-called-back-to-a-prior-job/
I do believe that the US will be able to repair its economy eventually, but the rate at which economic recovery can occur depends heavily upon how the Coronavirus is dealt with. The recent decision of President Trump to refuse discussion of a stimulus package will likely have a negative effect on working Americans, and potentially hinder the return of the pre-COVID economy. As stated by other commenters, the damage the economy has sustained that has resulted in the loss of many smaller businesses is likely to continue as such businesses are not likely to receive support without another stimulus package. As we continue to study the Coronavirus, we have observed a variety of new symptoms and consequences concerning it. For instance, in the past week, we have learned that patients have experienced encephalopathy, damage to the brain that can alter one's mental state. A vaccine is necessary to at least consider the beginning of returning to life as normal and returning to the improvement of the economy through in-person activities. Yet despite the importance of a vaccine, polls from organizations such as Pew indicate that few Americans feel safe with taking a first-generation vaccine that President Trump says works. I feel that their position is justified as President Trump has recently refused to recognize the updated standards that the head of the FDA wishes to implement with respect to an expedited vaccine. Without trust in vaccination, it becomes far more difficult to effectively return and revitalize the economy.
I agree with Ian that in time, the US will be able to repair its economy, but these gradual steps to lower unemployment will not be a "bounce back." I also remain skeptical on the reports and statistics surrounding unemployment and people finding new employment in the past few weeks/months. COVID has undoubtedly impacted the lives of practically every American family, and I doubt every unemployed individual had the chance to claim their unemployment insurance or report finding a job. Therefore these new statistics being published will likely see change overtime as more data becomes available. I also want to address another point that is impacting the unemployment and quality of life of millions of individuals, Congress has failed to pass another stimulus COVID relief bill since March. According to CNBC and Nancy Pelosi, if Congress fails to pass another bill by the end of the month, another 5 million Americans will"exhaust all of their unemployment benefits." This goes to show that millions of Americans are yet to see the "revamp" of the economy that parts of the media are publicizing.
https://www.cnbc.com/2020/11/02/as-congress-adjourns-with-no-stimulus-deal-millions-suffer.html
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