According to recent data released on May 8, 2020 by the Bureau of Labor Statistics (BLS), the U.S. lost 20.5 million jobs in April during the upheaval caused by the Wuhan virus pandemic.
The unemployment rate witnessed a meteoric rise from 4.4 percent in March to 14.7 percent in April, due to the closure of thousands of businesses brought about by shutdowns and overall uncertainty during the pandemic. The Hill noted that the “one-month rise in the unemployment rate between March and April is the largest ever recorded by the BLS.”
The Hill continued breaking down the bad economic news:
April’s staggering job losses also shattered records for both the largest one-month decline in jobs — roughly 2 million in September 1945 — and the highest level of unemployment ever recorded by the BLS, 10.8 percent in November 1982.
The jobs lost in April alone are nearly 2.5 times the 8.7 million jobs lost back in the Great Recession and nearly the same as the 22.4 million jobs recovered in the ensuing decade of recovery.
The U.S. has lost approximately 21.4 million since the Wuhan virus’s spread has disrupted Americans’ livelihoods.
Although 18.1 million of the 20.5 million jobs lost in April were because of temporary layoffs, per the BLS’s report, the great economic toll of the pandemic may compel many employers to shut down for good.
“Unfortunately, for many of those in the job market, the question becomes whether these jobs will return and these businesses reopen, which could have devastating and far-reaching economic effects,” stated Beth Ann Bovino, chief U.S. economist at S&P Global Ratings.
Bovino estimates that 90 percent of the U.S. population has been subject to several variations of stay-at-home orders as state and local governments attempted to contain the virus.
The Hill provided an overview of some of the sectors impacted by the pandemic:
The leisure and hospitality sector took the brunt of April’s damage, losing 7.7 million jobs as employment in the industry dropped 47 percent. A 5.5 million decline in restaurant and bar jobs made up most of the April plunge.
The Hill continued highlighting some other sectors negatively affected:
The pandemic wiped out 2.5 million education and health services jobs in April, including 503,000 losses in dental offices, 243,000 losses in physicians’ offices and 651,000 social assistance jobs.
The public sector has seen considerable retrenchment in employment:
Government employment also sunk by 980,000 jobs, including the loss of 801,000 jobs in local government that reflects widespread school closures. The sharp decline in government jobs come as states and municipalities face severe budget shortfalls driven by rising unemployment claims and falling tax revenue.
Additionally, The Hill shined light on how retail and other sectors of the economy have been impacted:
While the U.S. lost 2.1 million retail jobs in April, warehouse clubs and supercenters gained 93,000 workers. Professional and business services (2.1 million), manufacturing (1.3 million) and other services (1.3 million) also suffered seven-figure job losses.
According to the Labor Department, 33 million Americans have had to apply for unemployment benefits since the middle of March due to the closures.
The shutdowns have exacted a major toll on Americans and will continue to do so if they remain in place. Policymakers will have to come grips with the reality that the Wuhan virus is not a cataclysm of epic proportions. Thus, they should consider a more measured approach to reopening the economy so as to get people back on their feet.