Over the space of five weeks beginning seven months ago, 26 million Americans filed for their first installment of unemployment benefits. Since then, as the pandemic rages, at least another million have filed each and every week. Last week, as of Saturday, another 1.3 million made their initial filing, the Department of Labor reported Thursday. That’s a combination of regular state benefits (898,000) and the federal Pandemic Unemployment Assistance program (373,000), the latter covering freelancers and others ineligible for regular benefits. Taken together, that’s about 40,000 less than the previous week.
Some of those early filers have long since gone back to work. Some have been laid off again with the possibility of being called back again. Some have been permanently laid off and not been able to find a replacement job. Some are working part-time at their old job or a new one because that’s all they can get. “Some” is, I know, uncomfortably fuzzy. That’s because the presentation of the data in the midst of a crisis doesn’t offer us a wholly accurate, high resolution picture. Right now, for instance, we don’t really know how many people are receiving continuing unemployment benefits. The Department of Labor provides numbers that are widely viewed as an overcount. It’s uncertain how far off the mark it actually is.
This does not mean I think these or other job-related numbers are being fudged or faked or cooked, the way Donald Trump said President Obama did and a few Trump critics say he is doing. Nor that they are worthless. The numbers are fuzzy—or call them “soft” if you prefer—because they’re a byproduct of our highly fluid economic situation, the creaky obsolescence and understaffed circumstances of most state employment offices, and the distorted parameters used to define what “unemployed” and “not in the labor force” consists of. The latter has been a complaint of a number of economists and other critics for at least a dozen years.
Felix Salmon at Axios this week took note of the problem with the most crucial of those definitions, what constitutes unemployment itself: “A person who is looking for a full-time job that pays a living wage—but who can't find one—is unemployed. If you accept that definition, the true unemployment rate in the U.S. is a stunning 26.1%, according to an important new dataset shared exclusively with ‘Axios on HBO’":
Why it matters: The official unemployment rate is artificially depressed by excluding people who might be earning only a few dollars a week. It also excludes anybody who has stopped looking for work or is discouraged by a lack of jobs or by the demands of child care during the coronavirus crisis.
- If you measure the unemployed as anybody over 16 years old who isn't earning a living wage, the rate rises even further, to 54.6%. For Black Americans, it's 59.2%.
The backstory: The official definition of unemployment can be traced back to the 1870s, when a Massachusetts statistician named Carroll Wright diagnosed what he referred to as "industrial hypochondria".[...]
- The recession made everything worse. Only 46.1% of white Americans over the age of 16 — and a mere 40.8% of Black Americans — now have a full-time job paying more than $20,000 per year.
Expect critics to challenge that analysis on the grounds that definition mixes apples and oranges—that is, jobs with how much they pay—and makes things look worse than they actually are. That point of view is typically expressed from a perch well above what the American precariate faces everyday.
The financial pain tens of millions of Americans are already undergoing is almost certain to worsen as we enter what public health officials warn is our most perilous pandemic season, with the double whammy of COVID-19 and the flu hitting simultaneously. This inevitably means additional financial pain. Every state is already tallying rising rates of COVID-19 infection. All but the most stubborn governors will shut down parts of the economy now open, meaning more lost jobs to reduce the number of lost lives.
If we didn’t have Mitch McConnell laughing at people’s plight over the five months he has refused to give either of the House-passed HEROES stimulus bills a hearing in the Senate, much of that pain could be eased, giving Americans a breather to deal with all the other problems the pandemic has brought with it. The pain isn’t just pinched bank accounts. Empty bellies are on the rise, along with higher poverty. While McConnell laughs, food banks groan. If he had a nickel for every time he made a legislative move to seriously help people in need, he couldn’t make change for a dime.
Without more stimulus, some—there’s that word again—Americans will begin exhausting their 39 weeks of unemployment benefits (13 of them a federally mandated extension). If further economic lockdowns—even partial ones—occur over the next 6 to 12 months, which they almost certainly will, those workers who have reached the duration limit for benefits will be flat out of luck. One group getting hurt more than average: young workers.
At the Economic Policy Institute, Elise Gould and Melat Kassa have delved deeply into the situation for workers aged 16-24, scrutinizing the impact of gender and race within that demographic in their analysis of “Young workers hit hard by the COVID-19 economy.”
They cite a lot of numbers. Keep in mind that these too are fuzzy. But the trends they show are nevertheless quite clear, disturbing but not surprising. Here’s an excerpt and a single chart from their analysis to whet your appetite for more:
Across the United States, millions of workers of all ages suffered job losses in the coronavirus-driven recession, but the economic impact on young workers has been even more intense. Not only have many young people in this country faced the harsh reality of returning to school without in-person classes at their colleges and high schools, the job prospects for those seeking employment have been particularly bleak. Historically, young people are disproportionately disadvantaged in many ways during economic downturns, but this recession has been particularly acute given the sectors of the economy that were hit the hardest. Furthermore, many have been all but blocked from receiving jobless benefits even with meaningful expansions to the unemployment insurance system.
This paper investigates several important questions regarding young workers, defined as workers ages 16 to 24 years old. Our main findings of the experience of these workers in the labor market are summarized below.[…]
- Young workers’ already-high unemployment rates have jumped much higher. [...]
- Young workers are more likely to be in jobs impacted by COVID-19. [...]
- The economic effects of the COVID-19 economy on young workers may persist for years. [...]
- Young workers have been excluded from certain COVID-19 assistance. [...]
- A return to a strong economy would disproportionately help young workers. [...]
Among workers across the age distribution, young workers have had the largest job losses since February 2020. As a group, they are the most likely to be unemployed or underemployed, least likely to be able to work from home, and more likely to work in industries and occupations with the largest job losses in the COVID-19 labor market. While young workers are historically disadvantaged in weak economies, they have been even more negatively affected by the current recession. [...]
While exposure to a recession can have long-lasting negative effects on the employment and earnings of workers across the board, these effects are particularly damaging for younger workers who are just entering the labor market with little to no work experience. While the unemployment rate for all workers, regardless of age, race/ethnicity, gender, or educational attainment rises during recessions, the unemployment rate for younger workers often rises faster and higher compared with older workers due, in part, to employer hiring skewing away from less experienced workers (Forsythe 2019).
The Pandemic Recession has highlighted how longstanding inequities differentially affect people. Most of these inequities are chronic; they aren’t new. But we need to adopt new policies to deal with them, something that should have happened a long time ago.