These losses also follow steep cuts in March, when employers cut 870,000 jobs. Those two months amount to such serious layoffs that more than double the 8.7 million jobs lost during the financial crisis.
For many Americans who lost their jobs and homes during the 2008 financial crisis, this moment reopens old wounds. It took years to rebound from those setbacks. When the economy finally turned back, US employers added 22.8 million jobs in 10 years, a win for anyone who had survived the Great Recession.
Now, the coronavirus pandemic stings not only because of the public health crisis it has caused – but also because it has wiped out almost the entire decade of earnings in just two months.
By all accounts, it has been a devastating two months for American workers.
How we got here
In late March, state and local governments issued residence orders at home to slow the spread of coronavirus. Companies suddenly shut down en masse, laying off or laying off millions of workers.
The government job report shows some of the steepest job losses in leisure and hospitality, which lost 7.7 million jobs and retail, which lost 2.1 million jobs .
Food and drink stores, also essential during the crisis, lost 42,000 jobs.
And as terrible as those numbers, they don’t tell the full story.
The job numbers come from a survey conducted by employers and do not include independent contractors such as Uber and Lyft drivers in the concert economy.
Likewise, the unemployment rate, which stems from a survey of households, is likely to also underlie the number of Americans out of work.
People are counted as “unemployed” by the BLS when they have been out of work but have actively sought a new job in the previous four weeks. Or if they were a “temporary layoff” with the expectation of being reinstated within six months. About 18 million people were counted as “unemployed in the event of a temporary layoff” in April, compared to just 1.8 million the previous month.
But with much of the country still under house orders, many laid-off workers were not looking for new jobs in April. Instead of being considered “unemployed”, these people were classified as abandoned by the workforce. The employment-to-population ratio, which measures the percentage of the American population over 16 with a job, fell to 51.3% in April, down from 60% in March.
Economists predict that many people will be able to find jobs as companies reopen gradually, but it may take months or even years for the job market to return to its pre-pandemic strength.
Historically, the most disruptive aspect of recessions has been that jobs disappear and it takes years for companies to create new ones, said Adam Ozimek, chief economist of Upwork, a website that connects companies and freelancers. That dynamic may be different in the coronavirus recession, in which the optimistic outlook is that many, but not all, jobs will resume.
The leisure and hospitality sectors may take longer to recover, as policies of social distancing have destroyed the business models of companies.
Barbara Hull, 38, was a server at Caesar’s Palace in Las Vegas until March 18 when the blockade began. “We all knew it would happen,” he said.
“Financially, it’s scary for us [servers], because when we return we don’t know what we will return to, “he said about the reopening of the economy.” The central point of Las Vegas is to bring people together for this experience, and we don’t know how long it will take before we go back to that. “
She can’t imagine that it will be the same experience with servers like her wearing masks, she said.
Economists also worry if consumers will feel comfortable returning to the restaurant or traveling after the restrictions are lifted. For people like Hull this could mean less work and much lower tips after reopening. Prudent consumer behavior could delay an economic recovery.
“You will see a weaker demand for jobs involving many face-to-face interactions,” said Ozimek, adding that jobs that can be done remotely will be relatively safer during the crisis.
But experts also worry about a second wave of Covid-19 infections in the second half of the year. A recovery in some cases could favor a recovery.
It is also a frightening world for recent graduates looking for work during the crisis.
Micaela Stoia, 22, of Oxnard, California, was fired from her job as a dog trainer in Petco when the blockade started. He has applied for unemployment benefits, but has not yet received any money. Stoia studied political science in college and has aspirations to eventually work in government.
“At 26, I will need stable work with good benefits,” he said. “I have type I diabetes and I need those health benefits. I worked to achieve this, but the pandemic has put everything on hold.”
“It is a little difficult to start if I only have my degree and no experience,” he added. “Nobody is hiring for internship.”
It also expanded who can apply for unemployment benefits to include contractors, self-employed workers and workers in the concert economy. But many states have struggled to keep up with the sudden onslaught in unemployment claims.
– Tami Luhby and Katie Lobosco contributed to this report.
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