The 22 million jobs lost in March and April 2020 brought the US unemployment rate to 14.7%, the highest level since the Great Depression. As of November, only half of those jobs had been recovered. There’s a big hole to fill in 2021.
What Does Recovery Look Like?
Some economists are optimistic about the recovery going into next year. However, they do admit that it depends on the vaccine roll-out and getting Covid-19 under control.
Right now, the employment situation looks bleak, to be optimistic. The holiday season is normally a time of hiring. This year the surge in Covid-19 cases and resulting lockdown orders nationwide have drastically slowed hiring. November was described as a “concerning month,” while December is expected to be even worse.
The number of long-term unemployed, those who have been unemployed longer than 27 weeks, has jumped to 3.9 million in November. “Long-term unemployment doesn’t count into the unemployment rate,” said Michele Evermore, a senior policy analyst with the National Employment Law Project.
It Depends on the Vaccine
Vaccine approvals have been happening worldwide, most recently in the UK and the US. In the US the most at risk in nursing homes and frontline essential workers have already been receiving the vaccine. The CDC is recommending that everyone 16 years and older get the vaccine. However, many are concerned about the vaccine and are waiting to see how well it works, or even outright refusing to be vaccinated. Many political leaders have been publicly receiving the vaccine in broad news events held to appease the cautious.
Not surprisingly, economists expect a faster recovery than we’d normally see in a recession, once the vaccine has been widely distributed.
Andrew Chamberlain, Chief Economist at Glassdoor, cites three reasons:
- A strong housing market.
- A record personal savings rate that could spur spending.
- Pent-up demand for travel and leisure.
Jobs That Will Boom & Bust in 2021
Indeed and Glassdoor is seeing demand in healthcare, software engineering, warehousing, driving, and construction. While professional services, tech, and finance have seen a pause in hiring. Jed Kolko, an economist at Indeed, sees “chronic pain” in these sectors for a while.
What’s The Timeline to Recovery?
Despite tempered optimism for 2021, the timelines to full recovery look long.
Moody’s and McKinsey predict that it will take as long as 2025 for the economy to completely recover.