As we see rich countries slowly open up, there is an interesting economic phenomenon taking place. While Americans are coming out of lockdown, we are seeing a large number of jobs that are not being filled. There are about 9 million job openings in the United States and a little over 9 million people who are considered “unemployed”, and some 6 million people who weren’t actively looking for jobs, according to the Bureau of Labor Statistics. Why then are people not taking the jobs that are open?
The pandemic had forced a lot of businesses to close down and a lot of industries to stall, causing an all-time unemployment high of about 16% in April of 2020. The economic impact of the unstable job markets have caused more than a financial strain, but a social, and psychological one. The government has tried to weigh in and to ease this pain through benefits (unemployment insurance, unemployment, added benefits, etc). This could be one of the reasons why people aren’t getting back to work. They get paid more to NOT work. But it isn’t the only reason.
As much as people like to conclude that the unemployed are lazy, there is also another element: Fear. With jobs that have lots of in-person contact, like healthcare workers and retail workers, there is a significant risk of getting infected. Around 4 million people mentioned that they aren’t looking for work because they “Don’t want to get COVID”, according to The Economist. The Economist suggests that “allocation of work” is also changing as consumer preferences change post-pandemic, like delivery services versus in-restaurant dining.
Join us as we explore how the labor market looks today, which industries are experiencing the labor shortage, and why Americans aren’t going back to work.