Friday, May 1, 2020

Jobs and the Economy: Now and After the Pandemic, and Our Only Way Back

More views of where we are now, and where we will be when this thing eases, are coming forward. 

First, “America’s real coronavirus job losses could be worse than we thought.  Nearly 14 million people haven’t been able to apply for unemployment since the pandemic began” (Business Insider, April 28th).  The title says most.  We are only speculating about current jobless numbers, yet it is sad that per economist Elise Gould we may have many millions more who can’t apply for benefits or for whatever reason have not tried yet, on top of 26 million already filing.  Per the Economic Policy Institute we can thus add 60% to those who have got through the systems, many of whom cannot pay for rent or food, requiring, per a university economist, “a stimulus well beyond what we’ve already seen.”  The May 8th Bureau of Labor Statistics output, while hardly current, will be more accurate than the last one was on its release, and will tell us most of what we need to know.

Second, per the April 22nd Fox Business, “Global CEOs see U-shaped recession due to coronavirus.”  That is what three-fifths of them expected as of mid-April, with others predicting “a double-dip recession,” with the chance that “some household names will not survive.”  That is worse than the V shape some once hoped for, but is better than the L-shape we may well see into 2021.

Something else is happening which we haven’t had for decades – a high need for more unions.  Per “’We can’t go back to the way things were before.’ Pandemic job actions offer hope for renewed labor movement,” by Nicholas Riccardi and Dee-Ann Durbin of the Associated Press in the April 28th USA Today, the life-endangering nature of work not paying enough for that is causing de facto strikes.  Although, as Indeed economist Jed Kolko and the authors put it, “high unemployment and the end of a tight labor market create “the headwind for more worker power,” finding grocery and fast-food workers, among others, willing to risk their lives is proving harder, and health protection from employers has been spotty.  That recreates the situation we had in the likes of steelmaking and construction positions before their unionization, and labor organizations seem more justified than they have been for generations. 

Not every idea from educated people well-connected in their fields has merit, though – this week’s example is Brown University president Christina Paxson’s April 26th New York Times “College Campuses Must Reopen in the Fall.  Here’s How We Do It.”  All the author offered was noting how many jobs higher education supports and brushing off online instruction, to which other industries have no equivalent recourse, as presenting “financial, practical and psychological barriers.”  I could rewrite this article for other businesses in similar trouble, with at least as much merit and less need for vain hopes such as “regular testing” being able “to prevent the disease from spreading silently through dormitories and classrooms.”  Sorry, Dr. Paxson, but your backyard is no more entitled than others, and your article succeeds best at showing both how noncritical holding September college classes is and how unjustified it would be.

I was surprised not to see something pithier in “There’s Really Only One Way to Reopen the Economy” in the April 26th New York Times, but Aaron Carroll put his value in the statement, thus far underemphasized, that businesses will be crippled by customers either broke or unwilling to endanger their health.  I estimate that retail places, if allowed to open, would now average about one quarter of their previous sales.  As Carroll again correctly pointed out, we won’t be clearly back on track until there is a widely available vaccine.

Currently, Americans would do best, as Thomas L. Friedman put it also in the Times, to have “a science-based, nonpartisan debate through the hellish ethical (and) economic… trade-offs we have to make.”  We are inside a triangle with the three points personal economic wellbeing, national financial strength, and minimal coronavirus-caused death and illness, and can choose differing amounts of each of these but cannot give top priority to all.  For now, we as a nation are choosing health first and personal economic survival second, a course reasonable if unstudied.  Can we do better?  I do not know, and wish I were more optimistic about our ability to objectively determine and implement the solution.  In the meantime, let’s all cheer for Oxford and other vaccine researchers – until they succeed, we aren’t going much of anywhere. 

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