How Many U.S. Workers Have Lost Jobs During Coronavirus Pandemic? There Are Several Ways to Count
June 03 2020 - 5:59AM
Dow Jones News
By Eric Morath
Friday's U.S. jobs report from the Labor Department is expected
to show U.S. employers shed nearly 30 million positions from
payrolls this spring as a result of the coronavirus pandemic and
related shutdowns -- but that is just one of several varying
estimates of job destruction.
Other data suggest layoffs might have topped 40 million, while
another count shows only about 20 million are tapping unemployment
benefits. No matter the measure, job loss triggered by the pandemic
is historically high and likely to leave a lasting mark on the U.S.
economy.
"Depending on how you count it, you're talking about something
like a quarter of all U.S. jobs being disrupted by the pandemic,"
said Erica Groshen, a former Bureau of Labor Statistics
commissioner appointed by President Obama.
Nonfarm payrolls fell by a combined 21.4 million in March and
April, the Labor Department said. Economists surveyed by The Wall
Street Journal expect the May employment report to show another 8
million jobs were lost last month -- bringing the total decrease
since the pandemic took hold in the U.S. to more than 29
million.
The nonfarm-payrolls figures historically have been the most
closely watched measure of job creation and destruction. That is
because they capture a net change in employment, balancing hiring
and firing that are always occurring in both strong and weak
economies. They also are based on a survey of 145,000 businesses
and other employers, which is viewed as more accurate than asking
individuals about their employment status, and can be benchmarked
to tax records in the longer run.
Nonfarm payrolls have "a higher degree of precision than any
other timely number," Ms. Groshen said, adding that the survey
reaches establishments employing about a third of U.S. workers each
month.
During the pandemic-caused economic shock, economic analysts and
journalists have also highlighted the cumulative number of
unemployment-benefit claims, which are viewed as a proxy for
layoffs. From March 15 through May 23, 40.8 million jobless claims
applications have been filed.
However, many economists caution against equating that figure to
the number of Americans who are unemployed as a result of the
pandemic. Some applications were denied and others came from people
jobless before March.
It also is likely there is some double counting among the past
10 weeks of claims. An applicant might have tried again after an
initial denial, while others might have been recalled and again let
go from a job.
Expanded eligibility and enhanced benefits -- an extra $600 a
week for those who qualify -- are encouraging more Americans to
apply, said University of Michigan economist Donald Grimes.
"This is a very generous program," he said. "You're seeing a lot
of people that are applying who wouldn't have otherwise tried."
The cumulative figure from jobless claims also misses that some
number of applicants have returned to jobs, especially as states
have said more factories, construction sites and retailers can
operate.
In the week ended May 16, the most recent available data, 21
million Americans were receiving unemployment benefits.
Another measure of job loss is the unemployment rate. Economists
forecast that figure rose to 19.8% in May from 14.7% in April,
which was already the highest on record since 1948. May's projected
rate would imply about 30 million Americans were unemployed last
month.
The unemployment figures in the jobs report come from a separate
survey of 60,000 households.
That number does include some who were unemployed before the
pandemic began, but doesn't count those who lost jobs and
subsequently dropped out of the labor force, meaning they were
unable or unwilling to return to work. For example, some Americans
weren't looking for jobs because they feared becoming ill or were
responsible for caring for children who weren't in school.
For that reason, many economists are looking at the change in
the number of people reporting themselves as employed. In February,
158.8 million people said they had jobs. In April, that figure had
fallen by 25 million to 133.4 million.
The bottom line is tens of millions of jobs were lost in a
matter of three months -- and it will likely take several years for
them to be replaced.
"The magnitude and speed of this employment loss is like nothing
we've ever seen before," said University of Chicago economist Erik
Hurst. "I think it will take multiple years before we get back to
pre-March 2020 levels."
Write to Eric Morath at eric.morath@wsj.com
(END) Dow Jones Newswires
June 03, 2020 05:44 ET (09:44 GMT)
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