2020 was one of the most disruptive years ever for the U.S. job market, almost as significant as the unemployment during the Great Depression in 1933 and surpassing joblessness during the Great Recession from 2006 to 2008. Many businesses shut down for good, while others fought to survive.
Some industries, particularly travel and hospitality, struggle to get back up to speed after a slow 2020. Auto manufacturers are dealing with a chip shortage that left dealers and rental car companies low on inventory. On Labor Day, Monday, September 6, 2021, we recognize the impact of the COVID-19 pandemic on labor.
A Spike in Unemployment
During April 2020, the first full month of the COVID-19 crisis in the U.S., more than 20 million jobs were lost.1 The unemployment rate peaked at 14.7 percent, though by five months later, in September, it declined to a more modest 7.9 percent. During this time, unemployment benefits were enhanced to provide more weekly income to those who were out of work.
Though quite a few states are still taking advantage of these enhanced benefits, they are slated to end on September 6, 2021, which ironically is Labor Day.2
Certain Sectors Harder Hit
With lockdowns, mask requirements, and social-distancing rules, the hospitality, travel and restaurant industries were some of those hardest hit by the pandemic. Many bars and restaurants were forced to close for at least a short period. Once they were allowed to reopen, many were subject to a lower, maximum-capacity requirement. Airlines had to keep middle-seat tickets unsold, while hotels were forced to add new, and potentially expensive, sanitizing practices.
Many Women Stepped Out of the Workforce
Schools throughout the country shut their doors during the early stages of the pandemic, transitioning to e-learning and hybrid learning approaches. Many daycare centers also closed for business, either due to personnel loss or concern about the risk of COVID-19 transmission. Unfortunately for many working parents, this loss of childcare meant one parent needed to stop working to provide care for their children—and the default parent was often the mother.
Though it was rough on all women, the pandemic also disproportionately hurt minority women. The percentage of Hispanic or Latino women in the workforce declined from 59.1 percent in February 2020 to 45.2 percent in April 2020.3 Though it rebounded to 53.3 percent by April 2021, this measure—along with the proportion of Black and white women in the workforce—still remains lower than its pre-pandemic peak.
LPL Tracking # 1-05163602