The pandemic’s effects on US jobs in charts

The human cost to the US of the COVID-19 pandemic has been staggering. In just 10 months, the virus has claimed the lives of more than 300,000 Americans, and destroyed the livelihoods of many millions more.

The latest analysis by the US Bureau of Labor Statistics shows how severe the damage has been to the job market. At the end of November, there were 9.8 million fewer people in paid employment than in February (excluding farm work, which follows seasonal patterns). But, as can be seen in the chart below, some sectors of the economy have suffered far worse than others.

Change in non-farm payroll employment by industry since February 2020

By far the worst affected has been the leisure and hospitality industry. Travel restrictions and the closure of bars and restaurants have contributed to a loss of 3.4 million jobs - from waiters, kitchen staff and hotel workers to employees at gyms, theme parks and bowling alleys.

Other industries hit particularly hard are professional and business services, education and health services, and government payrolls, which have each lost more than a million jobs since the start of the crisis. 600,000 manufacturing jobs have vanished, as factories grappled with supply chain disruptions and dramatic falls in demand.

In contrast, some sectors have weathered the pandemic relatively well. Financial activities, mining and logging have seen much less severe contractions and utilities have shed the fewest jobs among the industries surveyed.

Crisis exacerbates inequality

A wide range of economic indicators demonstrate that the crisis has made existing inequalities worse, with a greater impact on young people, the low-paid, women (particularly mothers of school-age children) and ethnic minorities.

As the chart below shows, unemployment rose more quickly among Black or African-American workers than white workers, and even more dramatically among those identifying as Hispanic or Latino, peaking at nearly 19% in April.

Although unemployment is now falling again as the economy begins to recover, white workers are being rehired at a faster rate than other ethnicities. The unemployment rate for Black or African American workers was 10.3% in November, 4.5 percentage points higher than in February. In comparison, the difference between unemployment rates for white workers was just 2.8 percentage points.

The leisure and hospitality sector, which has suffered the biggest job losses, is also the lowest paid, as the chart below shows.

With average weekly wages of under $500, workers in the leisure and hospitality industry are much less likely to have the savings to absorb the financial shock of unemployment. Those in the retail sector and education and health services have found themselves in only a marginally less precarious position.

Bouncing back?

November may have seen rising COVID-19 cases, but it also saw encouraging signs of economic recovery, at least in some sectors. Overall, 245,000 jobs were added over the course of November.

Change in non-farm payroll employment by industry since October 2020

Transportation and warehousing saw by far the biggest boost in employment, partly as a result of Thanksgiving sales and stocking up ahead of Christmas. However, taken alongside the accompanying fall in retail employment, it is also likely that the COVID-19 pandemic has accelerated the existing global trend towards online shopping and deliveries, at the expense of traditional stores.

As economies around the world recover from the economic crisis triggered by COVID-19, it is likely that many of the jobs that have disappeared will not come back. For those who are out of work - and particularly the millions who are experiencing the financial and emotional distress of long-term unemployment - it is essential that opportunities are provided to develop the skills that will be needed for the jobs of the future.

And even before the pandemic, income and wealth inequality was higher in the US than in most other developed countries.