The Indicator from Planet Money - Jobs Friday: Reversal In The Recovery

For the first time since April, the American economy lost jobs. Today, we break down the December jobs report and the slowing economic recovery.

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Content Keywords: economy jobs jobs
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Avon station card appear. This is the indicator from planet money. Today is the first jobs Friday of the year, but unfortunately, we are going to have to refrain from blasting the traditional celebratory jobs Friday air horn because we did not get good news this morning. There was no good news this morning. The Bureau of Labor Statistics released the jobs report for the month of December and it showed that the economy lost a hundred forty thousand jobs. And this was the first month since last April that the economy has lost jobs, which means that the labor markets recovery, which was already slowing down has actually gone into reverse because of the covid-19 and throughout the country not every part of the labor market has been equally damaged and not every worker has been equally affected until 4 today. So we have scoured through the details of the child support and we are going to give you are three big takeaways from

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Report are takeaways not just for what happened last month, but for all of last year a year in which the economy lost more than 9 million jobs making 20/20 the single worst year of job losses since World War II 2020 that a lot of us would mean you prefer not to remember but a year that we will certainly never forget.

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Okay are three takeaways from the jobs report first when we look back over the last few months more and more people who lost their jobs because of the pandemic or not getting rehired and this has been one of the defining trends of the pandemic recently. We had all hoped it after the massive number of layoffs at the very beginning of the Pandemic those first couple of months that employers would be able to rehire a lot of their workers as the economy recovered and it first that is what happened that progress obviously stalled out and has gone into reverse we arrived in the US roughly 1 million people have been unemployed for more than half a year. Now. There are close to four million people for a long-term unemployed. And here's another way to look out of everyone who is unemployed right now more than one out of three of them have been unemployed for longer than half a year in system.

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There's so much because the longer somebody is out of work the harder it is for them to get a job again in the future. They start losing their contacts. Their skills can get rusty. Did you come to ejected and business might increasingly become reluctant to hire them. So unless the labor market improves their job loss increasingly starts to look permanent and that also matters for the rest of the economy because of long-term unemployment keeps Rising. That's also just a lot of people who are going to be afraid to spend any money in the economy and that hurts businesses that are still going in the people that work for them as well. So our second take away from this jobs report is the to understand what's happening in the labor market, you have to look at each economic sector individually because the effects of this pandemic have been really uneven across the economy arguably the sector that has suffered the most has been Leisure and hospitality and includes jobs mainly in restaurants and bars and hotels and also jobs in the Arts like jobs in the theater in

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Museums the sector have been recovering some of its jobs, but in December it started losing jobs again because of the pandemics Resurgens all across the u.s. Since the pandemic started almost one out of every four jobs in Leisure and Hospitality has been lost that is up to almost 4 million jobs and a lot of those jobs like jobs in restaurants and bars that have gone out of business are gone forever, which means those workers will have to find new jobs when the economy recovers and understand how big a deal this is think about it this way. There are almost 10 million fewer jobs in the whole economy Ethan before the covid-19 in 40% of all those disappearing jobs are accounted for just by the losses in this one single sector Leisure and Hospitality. We've been recovering we can look at the manufacturing and construction sectors. Both of those sectors are now close to having recovered all of the jobs that they initially lost in the early months of the pandemic and maybe just a

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There are signs that they will keep on growing keep on recovering the construction sector is obviously tied to the housing market and housing market is actually been booming for a couple of reasons first because mortgage rates are so low and second because there is just so much demand for houses and not many existing houses left that are available to buy which means the builders will pasta keep building more houses. It's doing well because people are buying more stuff more stuff to put in their houses where they're spending so much more time right now. It's at the most recent survey of managers in the manufacturing sector shows that the manufacturing economy has grown for the eighth consecutive month. Remember jobs in the manufacturing sector had mostly been falling for decades right now least they're going up that sucker is looking pretty good. The jobs gained in these sectors recently have obviously not been enough to offset the weakness in the rest of the labor market, but that's a silver lining that we still think people.

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Know about I feel like we need some Silver Linings right now. Why not and finally our third take away looking back across all of 20/20. It's just very clear have a labor markets collapse has intensified some of the inequalities that already existed going into the covid-19. And we can see this just simply by looking at the different unemployment rates for different groups. So for example, different racial and ethnic groups the unemployment rate throughout the pandemic has climbed more for Black and Hispanic Americans that has for white Americans. The black unemployment rate is close to 10% right now and for Hispanic Americans, it is above 9% The white unemployment rate is just 6% which is still high but lower than the overall unemployment rate to look at educational status college graduates, for example, for much more likely to be able to keep doing their jobs from the safety of their homes with their unemployment rate is just 3.8% really low.

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For high-school graduates still get unemployment rate is more than twice as high and her people who don't have a high school diploma. It's more than two and a half times as high close to 10% And there is also an incredible data point in this jobs report that shows us just how unequal the labor market is and here it is. So wages actually went up by more than 5% in the past year and it sounds like great news and a normal times. It would be great news wages are going up for people. But in this case it is not as good as it looks at first blush exactly because weed growth only measures the wages of people who still have their jobs and obviously still have wages that can be measured in right now. What highway is growth actually is showing is it people with low wages overwhelmingly more likely to have lost their jobs and therefore lost their wages. And what's a special about this right now?

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The Fortunes of all, these different groups have been converging in quality seem to be shrinking in the labor market because the low unemployment numbers the strong labor market and finally started reaching groups that had been left behind in the past and a pandemic has undone that progress It's also just a sign that so long as these inequalities persist these inequalities that have been around for a long time. Any new recession will likely impose more suffering on those groups that have been left behind traditionally than on everybody else.

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Is there a certain indicator was produced by Nick fountain in fact check by Shawn saldania indicators edited by Patty Hearst and it is a production of NPR.
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