Even though it seems to many like the pandemic has been dragging on for a decade already, it is, indeed, still in its first year. It brought with it many issues in all aspects of life, and the economy was certainly not spared, as unemployment trends show unemployment peaked at 24% for part-time workers and 13% for full-time workers amidst stay-at-home orders and initial struggles to stay afloat working for a country afraid to go outside.
Though it has improved quite a bit since as companies re-opened and some forms of stability were reached, most experts believe the rate will stay fairly high as we move into 2021. As much adaptation to the pandemic as the economy can make still can’t completely combat the fact that consumerism will always be slowed when the consumers are restricted on what and how they can purchase things.
Here are a few trends in employment that expect to continue after the turn of the year and the Administration change.
Job Creation Expected to Grow Steadily
No stark jump in unemployment trends is expected until a vaccine for the coronavirus can put stay-at-home orders and social distancing at bay, but as data surrounding the pandemic allows companies to analyze and act accordingly, those companies are expected to grow, even the ones that had to downsize at the onset of the pandemic.
Job competition may be a bit stiffer than expected, however, as colleges continued to function during COVID, and with that, a year’s worth of college graduates are now looking for employment in addition to those who lost work because of the pandemic. Though it was a struggle for many students, one of the benefits of going to college during the pandemic is an extra mark on a resume relative to a familiarity with remote work tools that some competitors may not have honed while unemployed.
According to Dr Jason Jolley, professor of rural economic development and MPA Director at the V. Voinovich School of Leadership and Public Affairs at Ohio University, “higher education has often been a haven for unemployed individuals to ride out economic downturns and get retrained for new jobs. This is a great time for unemployed individuals to return to school to sharpen their skills. Those continuing to seek employment need to differentiate themselves in a crowded marketplace by demonstrating unique skills in an era of remote work.”
COVID cases rose again in November, and though business being reopened certainly was good for the economy and the unemployment rate, it certainly led to the rises in cases as well. Just as businesses are adapting to the virus and figuring out which lines to toe between economics and safety, the government is doing the same.
Biden’s plan against spreading the coronavirus is certainly more restrictive from an economic standpoint, and this is part of why the growth is expected to be steady, rather than abrupt. Business rules will likely mean short-term closings, but Biden’s mandates on social distancing and masks will mean drops in cases and, optimistically, more business being able to operate safely and within the measures taken by the new administration.
“The official unemployment rate peaked at 11.1% in June 2020. However, the U-6 measure of employment peaked at 18% in June 2020. The U-6 measure considers those not actively looking for work (e.g. marginally attached to the labour force) and those working part-time because they cannot find full-time work,” added Dr Jolley.
“In October 2020, the official unemployment rate was 6.9% but the U-6 was 12.1%. A large stimulus package to put cash directly in the hands of lower and middle-class Americans, extended unemployment benefits, student loan forgiveness and/or deferred payments, are all important steps to help parttime workers and those unemployed. People need cash to spend to jumpstart the economy and create demand in the marketplace for goods and services.”
Though not exciting to write about, most scientists do not see an end of the pandemic shortly. Most are still optimistic that a vaccine, or some other breakthrough to allow the public to go back to normal life, will be available by the end of the year, but even that is considered hopeful by most.
“If the vaccine is effective if it’s rapidly deployed, and if the public can be convinced the vaccine is safe, then I would expect an improved economy and an improvement in unemployment trends. However, that is a lot of “ifs.” Even with an effective vaccine, many small businesses have already closed permanently,” added Dr Jolley.
A slow and steady preparation for jumping back into normal life should certainly be worked on, but to say it needs to be a central focus in the short-term would be highly optimistic.
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Andrew Deen has been a consultant for startups in almost every industry from retail to medical devices and everything in between. He is currently writing a book about scaling up business and his experience implementing lean methodology.