With unemployment down to 5.8% for May, the change in the economy from a year ago is nothing short of a miracle. Late last spring, in the throes of the pandemic, the future appeared to bring nothing but gloom and doom. Although the economy is still not perfect, a remarkable vaccine and some extra government relief has helped the country inch its way back to its pre-pandemic ways.
The Bureau of Labor Statistics defines long-term unemployment as being jobless for 27 weeks or longer and having been actively trying to get a new job for at least four weeks.
“The number of long-term unemployed fell by 431,000 to 3.8 million people, according to the May jobs report issued Friday by the Bureau of Labor Statistics.”
“It’s an encouraging sign to see long-term unemployment falling,” said Daniel Zhao, a senior economist at Glassdoor, a job and recruiting site. “It’s always going to be a hard number to budge.”
With long-term unemployment comes a decline in available spending money, but also family pressure and stress. If you are worried about putting food on the table and paying the mortgage, tensions run high. Long-term unemployment disrupts a person’s life in many other ways as well. According to The Balance, nearly 40% of people felt that their self-respect suffered, and 43% said the recession affected their career goals. For true self-actualization, people need to get back to work, for more reasons than just a paycheck.
Moving in the Right Direction
Though there are still far too many people suffering from long-term unemployment, and the resulting personal anxiety, there are also positive signs of recovery. USA Today reports that although the economy is not back where it was pre-pandemic, “more than 14.1 million jobs have returned since the April 2020 low.” This is significant news for 14.1 million people who are once again employed, and the money they are earning also goes back into the economy as they spend it.
“While the April increase was much smaller than projected, other signs of economic growth abound. GDP grew by a robust 6.4% in the first quarter, retail sales jumped almost 10% in March and the S&P 500 has notched multiple record highs since August.” Even though the stock market is not a complete representation of the economy, a rising stock market tends to precede general economic improvement.
Because of the vaccine being widely disseminated, and the efficacy of the vaccines keeping the coronavirus at bay, the country continues to open the doors of restaurants, theme parks, movie theaters, and all the places that will get Americans out of their homes. This is a perfect juxtaposition with summer, as the weather warms in much of the country and people are filled with wanderlust.
Room for Improvement
Though the news about the recovery is positive, there are still several areas of concern. One factor is that different states are recovering at different rates. USA Today reports, “Vermont, South Dakota and Nebraska have unemployment rates below 3%, while unemployment in New York, Hawaii and Puerto Rico is nearly three times higher.”
Besides where you live, what you do for a living might also be holding you back. A full 34.5% of the jobs that haven’t returned since February 2020 are hospitality or leisure related. For workers and their families in this industry, the pandemic has been disastrous, as they look for entirely new industries in which to use their skills.
Unfortunately, racial inequalities are still an issue. USA Today said, “Black Americans’ unemployment rate is more than 3 percentage points higher than the national average. Hispanic Americans’ jobs were hit the hardest last spring with unemployment reaching nearly 19% and remain nearly 2 percentage points above the national average.” As the saying goes, we are all in the same storm but not in the same boat.
One perplexing problem has actually been created by the government with pandemic-relief legislation, which has increased the amount of aid three different times for the long-term unemployed. Benefits are set to expire on September 6, though nearly half the states are declining the benefits because the states think the benefits are encouraging workers to stay home and not look for jobs. Certainly, if you look around the country you see “Help Wanted” signs in so many sectors, and the restaurant and retail industries are dying for workers.
Though not entirely out of the woods yet, the economy seems to be on a positive trajectory. Though certain industries and parts of the country are still suffering, most Americans are ready for full speed ahead pre-pandemic living.