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The Jobs Numbers Will Be Terrible. Here’s How to Interpret Them. The Jobs Numbers Will Be Terrible. Here’s How to Interpret Them.
(8 days later)
The coronavirus pandemic has brought wave after wave of catastrophic economic data: The worst decline in gross domestic product in a decade. The worst retail sales report on record. The worst week ever for unemployment claims, and then two more twice as bad as that.The coronavirus pandemic has brought wave after wave of catastrophic economic data: The worst decline in gross domestic product in a decade. The worst retail sales report on record. The worst week ever for unemployment claims, and then two more twice as bad as that.
But even by those recent standards, the April jobs numbers could stand out.But even by those recent standards, the April jobs numbers could stand out.
Economists surveyed by MarketWatch expect the report, which the Labor Department will release on Friday, to show that U.S. payrolls fell by 22 million jobs last month — a decade’s worth of job gains, wiped out in weeks. The payroll processing company ADP said on Wednesday that the private sector lost more than 20 million jobs in April, with the cuts spread across every sector and size of employer.Economists surveyed by MarketWatch expect the report, which the Labor Department will release on Friday, to show that U.S. payrolls fell by 22 million jobs last month — a decade’s worth of job gains, wiped out in weeks. The payroll processing company ADP said on Wednesday that the private sector lost more than 20 million jobs in April, with the cuts spread across every sector and size of employer.
To put that in perspective: In the worst month of the last recession, the U.S. lost 800,000 jobs. The worst monthly loss on record was nearly two million jobs in September 1945, when the country was demobilizing after World War II. (The population has grown since then, but not enough to account for the difference.)To put that in perspective: In the worst month of the last recession, the U.S. lost 800,000 jobs. The worst monthly loss on record was nearly two million jobs in September 1945, when the country was demobilizing after World War II. (The population has grown since then, but not enough to account for the difference.)
The April unemployment rate is likely to hit 15 percent or higher, by far the worst since the Great Depression. And the deterioration has happened with almost unfathomable swiftness: Two months earlier, the rate was 3.5 percent, a 50-year low.The April unemployment rate is likely to hit 15 percent or higher, by far the worst since the Great Depression. And the deterioration has happened with almost unfathomable swiftness: Two months earlier, the rate was 3.5 percent, a 50-year low.
“It’s not just the magnitude of these numbers; it’s the speed with which they’re happening that’s really stunning,” said Nick Bunker, who leads North American economic research at the Indeed Hiring Lab.“It’s not just the magnitude of these numbers; it’s the speed with which they’re happening that’s really stunning,” said Nick Bunker, who leads North American economic research at the Indeed Hiring Lab.
Friday’s report will paint the clearest picture yet of the economic devastation, and could provide some important hints about the eventual recovery. But it will also bring complications that will make the numbers difficult to interpret.Friday’s report will paint the clearest picture yet of the economic devastation, and could provide some important hints about the eventual recovery. But it will also bring complications that will make the numbers difficult to interpret.
It’s no surprise that employers have cut millions of jobs; weekly data on filings for unemployment benefits have tracked the destruction. The most recent report, covering the last full week of April, showed that roughly 30 million Americans had filed jobless claims since the new coronavirus began to shut down the economy. The next weekly report, due Thursday, will probably add millions more.It’s no surprise that employers have cut millions of jobs; weekly data on filings for unemployment benefits have tracked the destruction. The most recent report, covering the last full week of April, showed that roughly 30 million Americans had filed jobless claims since the new coronavirus began to shut down the economy. The next weekly report, due Thursday, will probably add millions more.
Those figures are more up to date than the monthly jobs report coming Friday, which will cover hiring and firing through mid-April. But the monthly numbers are more comprehensive than the weekly ones, which almost certainly understate the damage. Not everyone who has lost a job qualifies for benefits, and many who do qualify have not yet filed a claim because the flood of applicants has overwhelmed state unemployment offices.Those figures are more up to date than the monthly jobs report coming Friday, which will cover hiring and firing through mid-April. But the monthly numbers are more comprehensive than the weekly ones, which almost certainly understate the damage. Not everyone who has lost a job qualifies for benefits, and many who do qualify have not yet filed a claim because the flood of applicants has overwhelmed state unemployment offices.
The monthly data, based on surveys of businesses and households, should provide a more complete estimate of job losses. It will also reflect the extent to which hiring at companies like Amazon and Walmart has offset them. And unlike the weekly data, which mostly counts losses, the monthly report includes data on working hours, which will help quantify the millions of people who have held on to their jobs but had their hours cut.The monthly data, based on surveys of businesses and households, should provide a more complete estimate of job losses. It will also reflect the extent to which hiring at companies like Amazon and Walmart has offset them. And unlike the weekly data, which mostly counts losses, the monthly report includes data on working hours, which will help quantify the millions of people who have held on to their jobs but had their hours cut.
Friday’s report will also provide the most detailed breakdown yet of job losses by industry. That could help answer a question that could be crucial to the eventual recovery: How far has the damage spread?Friday’s report will also provide the most detailed breakdown yet of job losses by industry. That could help answer a question that could be crucial to the eventual recovery: How far has the damage spread?
The last jobs report, based on data from early March, showed large losses in restaurants, hotels and other industries hit hardest by the first wave of shutdowns. Those cuts were no doubt even larger in April, and the report will also show large losses in retail, which has seen a tidal wave of business closings and bankruptcies.The last jobs report, based on data from early March, showed large losses in restaurants, hotels and other industries hit hardest by the first wave of shutdowns. Those cuts were no doubt even larger in April, and the report will also show large losses in retail, which has seen a tidal wave of business closings and bankruptcies.
If the losses are concentrated in sectors that have been directly affected by the virus, that could bode well for the recovery, because it suggests the damage has been contained, at least so far. But if it has spread to industries like finance and professional services, that could suggest a cascade effect is underway, with laid-off workers pulling back on spending, leading to lost revenues and still more layoffs. It could take much longer to climb out of that kind of hole.If the losses are concentrated in sectors that have been directly affected by the virus, that could bode well for the recovery, because it suggests the damage has been contained, at least so far. But if it has spread to industries like finance and professional services, that could suggest a cascade effect is underway, with laid-off workers pulling back on spending, leading to lost revenues and still more layoffs. It could take much longer to climb out of that kind of hole.
In the 70-plus years that the government has been keeping track, the unemployment rate has never exceeded 10.8 percent. It will almost certainly pass that level on Friday, and some economists think the rate could be twice as high. That would rival the worst periods of the Great Depression, when economic historians estimate unemployment reached 25 percent.In the 70-plus years that the government has been keeping track, the unemployment rate has never exceeded 10.8 percent. It will almost certainly pass that level on Friday, and some economists think the rate could be twice as high. That would rival the worst periods of the Great Depression, when economic historians estimate unemployment reached 25 percent.
But the rate probably should be even higher.But the rate probably should be even higher.
To be considered unemployed in the government’s official measure, people generally must be actively looking for a job. (Or else they can be on a temporary layoff — more on that in a bit.) But during severe recessions, people often stop looking for work because they don’t believe jobs are available, leading the unemployment rate to understate joblessness.To be considered unemployed in the government’s official measure, people generally must be actively looking for a job. (Or else they can be on a temporary layoff — more on that in a bit.) But during severe recessions, people often stop looking for work because they don’t believe jobs are available, leading the unemployment rate to understate joblessness.
That issue could be particularly significant now, when not only are jobs scarce but people are also being urged to stay home to avoid spreading the virus. In fact, the government is easing the pressure to search for work by offering more generous unemployment benefits, and many states are waiving work-search requirements to qualify. And with schools and day care centers closed, many parents can’t work because of child care responsibilities.That issue could be particularly significant now, when not only are jobs scarce but people are also being urged to stay home to avoid spreading the virus. In fact, the government is easing the pressure to search for work by offering more generous unemployment benefits, and many states are waiving work-search requirements to qualify. And with schools and day care centers closed, many parents can’t work because of child care responsibilities.
The Labor Department publishes several broader measures of unemployment and underemployment that address some of these issues by including people who aren’t looking for work or whose hours have been cut back. But the government’s employment survey wasn’t designed for a pandemic, and it is unclear how well it will capture all the unusual nuances that the current crisis presents.The Labor Department publishes several broader measures of unemployment and underemployment that address some of these issues by including people who aren’t looking for work or whose hours have been cut back. But the government’s employment survey wasn’t designed for a pandemic, and it is unclear how well it will capture all the unusual nuances that the current crisis presents.
“There’s not one number about the labor market that’s going to tell you everything you want to know,” said Erica Groshen, a Cornell University economist who led the Bureau of Labor Statistics in the Obama administration.“There’s not one number about the labor market that’s going to tell you everything you want to know,” said Erica Groshen, a Cornell University economist who led the Bureau of Labor Statistics in the Obama administration.
Updated July 7, 2020
The coronavirus can stay aloft for hours in tiny droplets in stagnant air, infecting people as they inhale, mounting scientific evidence suggests. This risk is highest in crowded indoor spaces with poor ventilation, and may help explain super-spreading events reported in meatpacking plants, churches and restaurants. It’s unclear how often the virus is spread via these tiny droplets, or aerosols, compared with larger droplets that are expelled when a sick person coughs or sneezes, or transmitted through contact with contaminated surfaces, said Linsey Marr, an aerosol expert at Virginia Tech. Aerosols are released even when a person without symptoms exhales, talks or sings, according to Dr. Marr and more than 200 other experts, who have outlined the evidence in an open letter to the World Health Organization.
Common symptoms include fever, a dry cough, fatigue and difficulty breathing or shortness of breath. Some of these symptoms overlap with those of the flu, making detection difficult, but runny noses and stuffy sinuses are less common. The C.D.C. has also added chills, muscle pain, sore throat, headache and a new loss of the sense of taste or smell as symptoms to look out for. Most people fall ill five to seven days after exposure, but symptoms may appear in as few as two days or as many as 14 days.
Scientists around the country have tried to identify everyday materials that do a good job of filtering microscopic particles. In recent tests, HEPA furnace filters scored high, as did vacuum cleaner bags, fabric similar to flannel pajamas and those of 600-count pillowcases. Other materials tested included layered coffee filters and scarves and bandannas. These scored lower, but still captured a small percentage of particles.
A commentary published this month on the website of the British Journal of Sports Medicine points out that covering your face during exercise “comes with issues of potential breathing restriction and discomfort” and requires “balancing benefits versus possible adverse events.” Masks do alter exercise, says Cedric X. Bryant, the president and chief science officer of the American Council on Exercise, a nonprofit organization that funds exercise research and certifies fitness professionals. “In my personal experience,” he says, “heart rates are higher at the same relative intensity when you wear a mask.” Some people also could experience lightheadedness during familiar workouts while masked, says Len Kravitz, a professor of exercise science at the University of New Mexico.
The steroid, dexamethasone, is the first treatment shown to reduce mortality in severely ill patients, according to scientists in Britain. The drug appears to reduce inflammation caused by the immune system, protecting the tissues. In the study, dexamethasone reduced deaths of patients on ventilators by one-third, and deaths of patients on oxygen by one-fifth.
The coronavirus emergency relief package gives many American workers paid leave if they need to take time off because of the virus. It gives qualified workers two weeks of paid sick leave if they are ill, quarantined or seeking diagnosis or preventive care for coronavirus, or if they are caring for sick family members. It gives 12 weeks of paid leave to people caring for children whose schools are closed or whose child care provider is unavailable because of the coronavirus. It is the first time the United States has had widespread federally mandated paid leave, and includes people who don’t typically get such benefits, like part-time and gig economy workers. But the measure excludes at least half of private-sector workers, including those at the country’s largest employers, and gives small employers significant leeway to deny leave.
So far, the evidence seems to show it does. A widely cited paper published in April suggests that people are most infectious about two days before the onset of coronavirus symptoms and estimated that 44 percent of new infections were a result of transmission from people who were not yet showing symptoms. Recently, a top expert at the World Health Organization stated that transmission of the coronavirus by people who did not have symptoms was “very rare,” but she later walked back that statement.
Touching contaminated objects and then infecting ourselves with the germs is not typically how the virus spreads. But it can happen. A number of studies of flu, rhinovirus, coronavirus and other microbes have shown that respiratory illnesses, including the new coronavirus, can spread by touching contaminated surfaces, particularly in places like day care centers, offices and hospitals. But a long chain of events has to happen for the disease to spread that way. The best way to protect yourself from coronavirus — whether it’s surface transmission or close human contact — is still social distancing, washing your hands, not touching your face and wearing masks.
A study by European scientists is the first to document a strong statistical link between genetic variations and Covid-19, the illness caused by the coronavirus. Having Type A blood was linked to a 50 percent increase in the likelihood that a patient would need to get oxygen or to go on a ventilator, according to the new study.
If air travel is unavoidable, there are some steps you can take to protect yourself. Most important: Wash your hands often, and stop touching your face. If possible, choose a window seat. A study from Emory University found that during flu season, the safest place to sit on a plane is by a window, as people sitting in window seats had less contact with potentially sick people. Disinfect hard surfaces. When you get to your seat and your hands are clean, use disinfecting wipes to clean the hard surfaces at your seat like the head and arm rest, the seatbelt buckle, the remote, screen, seat back pocket and the tray table. If the seat is hard and nonporous or leather or pleather, you can wipe that down, too. (Using wipes on upholstered seats could lead to a wet seat and spreading of germs rather than killing them.)
If you’ve been exposed to the coronavirus or think you have, and have a fever or symptoms like a cough or difficulty breathing, call a doctor. They should give you advice on whether you should be tested, how to get tested, and how to seek medical treatment without potentially infecting or exposing others.
Some economists recommend looking at a simpler measure: the share of the population that is working. That is subject to fewer definitional challenges, and should provide a clearer picture of the damage. Expect it to show the biggest one-month drop on record.Some economists recommend looking at a simpler measure: the share of the population that is working. That is subject to fewer definitional challenges, and should provide a clearer picture of the damage. Expect it to show the biggest one-month drop on record.
Perhaps the single most important factor that will decide the speed of the recovery is how many people can go back to their jobs when businesses reopen.Perhaps the single most important factor that will decide the speed of the recovery is how many people can go back to their jobs when businesses reopen.
Friday’s report won’t answer that question. But it could provide a hint. The monthly numbers distinguish between people who have lost their jobs permanently and those on a temporary layoff or furlough. The larger the share of workers in the second category, the faster the recovery could be.Friday’s report won’t answer that question. But it could provide a hint. The monthly numbers distinguish between people who have lost their jobs permanently and those on a temporary layoff or furlough. The larger the share of workers in the second category, the faster the recovery could be.
The problem is that many temporary layoffs could turn into permanent job losses as the shutdowns drag on.The problem is that many temporary layoffs could turn into permanent job losses as the shutdowns drag on.
“One thing I’ve been worried about is that temporary layoffs will not remain temporary,” said Martha Gimbel, an economist and labor market expert at Schmidt Futures, a philanthropic initiative.“One thing I’ve been worried about is that temporary layoffs will not remain temporary,” said Martha Gimbel, an economist and labor market expert at Schmidt Futures, a philanthropic initiative.
It might make sense to think of these numbers as a benchmark: Workers who were temporarily laid off won’t necessarily get their old jobs back, but they might, if the recovery goes smoothly. Permanently laid-off workers will in most cases need to start their job searches from scratch.It might make sense to think of these numbers as a benchmark: Workers who were temporarily laid off won’t necessarily get their old jobs back, but they might, if the recovery goes smoothly. Permanently laid-off workers will in most cases need to start their job searches from scratch.
“Temporary layoffs are a measure of what could happen if we do this right,” Ms. Gimbel said.“Temporary layoffs are a measure of what could happen if we do this right,” Ms. Gimbel said.
The monthly jobs figures are a preliminary estimate, and are always subject to revision. But this month, there is extra reason for caution.The monthly jobs figures are a preliminary estimate, and are always subject to revision. But this month, there is extra reason for caution.
For one thing, the pandemic has made it difficult to collect the data that the numbers rely on. The call centers where workers conduct the surveys are closed. In-person interviews have been suspended. And households and businesses have been disrupted in ways that might make them less likely to respond to surveys.For one thing, the pandemic has made it difficult to collect the data that the numbers rely on. The call centers where workers conduct the surveys are closed. In-person interviews have been suspended. And households and businesses have been disrupted in ways that might make them less likely to respond to surveys.
The widespread business disruptions could also skew the data in another way. Government statisticians use a model to estimate how many businesses have opened or closed in a month. But when economic conditions deteriorate rapidly, the model can struggle to keep up. In the last recession, the Labor Department initially underestimated job losses, and this collapse has been much faster.The widespread business disruptions could also skew the data in another way. Government statisticians use a model to estimate how many businesses have opened or closed in a month. But when economic conditions deteriorate rapidly, the model can struggle to keep up. In the last recession, the Labor Department initially underestimated job losses, and this collapse has been much faster.
The Labor Department said last week that it would modify the model to better account for the current situation, but it has released no details.The Labor Department said last week that it would modify the model to better account for the current situation, but it has released no details.