Bizarro World

Published 10/26/2020
Why is this time different?
 
In Superman's bizarro world, nothing seemed to make sense. Everything was the opposite of what was expected. It would seem that today's pandemic impacted economy, especially as it relates to hiring, would feel right at home in the Man of Steel's alternate universe.
 
(I would have used a Superman Bizarro World image, but I didn't think that D.C. Comics would like it.)
 
We have record unemployment, yet jobs go unfilled. According to the U.S. Bureau of Labor Statistics, the September unemployment rate had decreased to 7.9% with the number of people unemployed down to 12.6 million. Among those workers who are unemployed, the number of permanent job losers is 3.8 million (up by 2.5 million since February).
 
Companies are raising wages, but it does little to entice workers to return. The labor force participation rate decreased to 61.4 percent, 2% lower than in February. You would think, with wages lagging behind most other economic indicators, workers would be clamoring for jobs with higher wages. It's not happening.
 
Even the impact of the extra unemployment money is no longer much of a factor because the program has pretty much run its course, and congress is unable (or unwilling) to pass more aid during an election.
 
According to Statista, "as of September 2020, the leisure and hospitality industry had the highest unemployment rate in the United States, at 19 percent. In comparison, workers in the government industry experienced the lowest unemployment rate, at 4.1 percent. The average for all industries was 7.7 percent."
 
As reported by Nic Querolo and Leslie Patton in Bloomberg, "Not even the greatest surge in joblessness in 80 years is easing the fast-food industry’s years-old labor shortage.
 
That’s because the COVID-19 pandemic is making this year’s economic crisis very different than past downturns when restaurants offered an important lifeline for the newly unemployed. Since service-sector jobs now mean a higher chance of infection, even higher pay isn’t coaxing workers into the kitchen.
 
Key demographics — like teenagers, at the urging of their parents, and the elderly — are staying away for health and safety reasons, and emergency-enhanced unemployment checks have kept others on the sidelines. Restaurant chains are reporting they’re paying more, but that doesn’t mean they’re filling their staff openings."
 
As reported in the Bureau of Labor Statistics, as of mid-July, only half of the 6.1 million food-service jobs lost in March and April had returned. Even with the typical summer increase of teenage workers available, "there were fewer youth employed in July than in February 2020, before the pandemic unfolded in many parts of the United States. The employment–population ratio for youth—the proportion of 16- to 24-year-olds with a job—was 46.7 percent in July 2020. That was down 9.5 percentage points from July 2019".
 
The number of people working remotely has increased dramatically between 2005 and 2018, rising by 173%. The impact of the COVID-19 pandemic has not only caused a significant increase in remote work, but has also accelerated the trend permanently. In fact, a work-at-home-after-COVID forecast estimates that 25-30% of the U.S. workforce will be working from home multiple days a week by the end of 2021.
 
The big question is "what about those jobs that can't be done remotely"? Until we have a reliable COVID-19 vaccine, the economy will continue to be sluggish due to those unfilled jobs that have to be done on-site at the workplace.
 
It's accurate to say that 2020 has been an amazing year that has truly and permanently upended the apple cart. There is hope. If you are having difficulty finding employees, ASN is ready to help. Give us a call and let us show you what we can do.