speech on unemployment due to covid 19

An Unemployment Crisis after the Onset of COVID-19

Nicolas Petrosky-Nadeau and Robert G. Valletta

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FRBSF Economic Letter 2020-12 | May 18, 2020

The COVID-19 pandemic has upended the U.S. labor market, with massive job losses and a spike in unemployment to its highest level since the Great Depression. How long unemployment will remain at crisis levels is highly uncertain and will depend on the speed and success of coronavirus containment measures. Historical patterns of monthly flows in and out of unemployment, adjusted for unique aspects of the coronavirus economy, can help in assessing potential paths of unemployment. Unless hiring rises to unprecedented levels, unemployment could remain severely elevated well into next year.

The wave of initial job losses during the coronavirus disease 2019 (COVID-19) pandemic has been massive, with more than 20 million jobs swept away between March and April. This is much larger than losses recorded during similar time frames in any other postwar recession. As a result, the April unemployment rate spiked to the highest level recorded since the Great Depression of the 1930s.

In this Economic Letter , we assess possible paths for unemployment through 2021. Although the initial scale of the crisis is clear, substantial uncertainty surrounds the future path of unemployment. This uncertainty primarily revolves around the success of virus containment measures and how quickly economic activity can recover. Fundamental measurement challenges are also likely to affect the official unemployment rate: some laid-off workers cannot actively search for new jobs because of shelter-in-place restrictions and hence may be counted as out of the labor force, rather than unemployed.

To assess the possible path of the measured unemployment rate through next year, we focus on the underlying monthly flows in and out of unemployment, accounting for historical patterns and unique aspects of the coronavirus economy; our approach and results are described in detail in Petrosky-Nadeau and Valletta (2020). Our analysis suggests that returning to pre-outbreak unemployment levels by sometime in 2021 would require a significantly more rapid pace of hiring than during any past economic recovery.

Initial wave of job losses and unemployment

Even before the Bureau of Labor Statistics (BLS) released April employment and unemployment numbers on May 8, the unprecedented scale of job losses due to coronavirus containment measures was clear. About 25 million new unemployment insurance (UI) claims were filed between mid-March, when U.S. containment measures started to spread widely and the BLS monthly survey was conducted, and mid-April when the next month’s BLS survey was conducted. During periods of intensive job loss, weekly reports on new UI claims provide a good measure of job losses because most laid-off workers are eligible for UI benefits. However, the current massive scale of new claims has swamped state UI agencies and likely delayed processing of many claims. As such, the recent surge should be interpreted as a loose lower-bound estimate of initial job losses.

A comparison with the Great Recession of 2007-09 starkly illustrates the severity of the current situation (Figure 1). Initial UI claims during the first month of the COVID-19 crisis were about 10 times larger than claims during the worst periods of the Great Recession.

Figure 1 Monthly initial unemployment insurance claims

Note: Data from the U.S. Department of Labor, not seasonally adjusted (last two data points rounded to nearest thousand; April data through May 2). Gray bar indicates NBER recession dates.

These initial job losses, combined with a likely pronounced reduction in hiring activity, imply a sharp increase in the unemployment rate. Before the April BLS report was released, we projected that the unemployment rate was likely to rise nearly 15 percentage points, from 4.4% in March to 19.0% in April.

Other recent projections of the April unemployment rate span a very wide range (Faria-e-Castro 2020, Wolfers 2020, Coibion, Gorodnichenko, and Weber 2020, and Bick and Blandin 2020). The wide range partly reflects the challenge of measuring unemployment when shelter-in-place restrictions prevent active job search in much of the country. This is evident in the estimates by Coibion et al. (2020) and Bick and Blandin (2020), which differed substantially despite their reliance on careful surveys designed to approximate the official BLS approach.

The official April employment report released on May 8 showed that unemployment rose to 14.7%, a huge increase but below our projection. However, the report also noted a large increase in the number of workers on unpaid absences, likely reflecting virus-related business closures. Counting these workers as unemployed would push the unemployment rate much closer to our 19% projection. We therefore have not modified our prior projections.

Unemployment projections based on labor market flows

Our approach to projecting the unemployment rate relies on the monthly flows between unemployment, employment, and out of the labor force (nonparticipation), similar to Şahin and Patterson (2012). In particular, the monthly change in the unemployment rate reflects the difference between the number who enter unemployment (inflows) and the number who exit unemployment (outflows), with employment and nonparticipation as possible initial or subsequent status. This framework accounts for the key determinants of pandemic-related unemployment, with initial UI claims (inflows through job loss) and depressed hiring (outflows) determining the initial spike in unemployment. Using this approach, we explore different scenarios for unemployment through the end of 2021. For all scenarios, we assume that job losses are most severe in April (about 25 million), then ease substantially in May (7.8 million) and June (2.6 million), before returning to their historical trend in July (1.4 million).

The path of the unemployment rate afterward depends on unemployment outflows, primarily reflected in the pace of hiring among the pool of unemployed individuals. Tremendous uncertainty surrounds the timing and strength of the hiring surge as the economy recovers. If the virus is contained quickly and the economic recovery is vigorous, hiring could rapidly resume, particularly if many businesses and workers have maintained their connections. However, hiring could be slow if virus outbreaks or continued containment measures make employers hesitant based on low demand for their products. We therefore explore a range of hiring scenarios over the coming months.

The first scenario, “historical outflow dynamics,” assumes that the pace of hiring corresponds statistically to the typical recovery from past recessions. Because hiring tends to bounce back slowly following recessions, and given the severity of the current downturn, this scenario is relatively adverse.

Our second scenario, “hiring bounce,” incorporates very strong hiring activity following an assumed end of COVID-19 restrictions in July 2020. This scenario provides a baseline for assessing the pace of hiring required to reverse the initial labor market shock. It assumes a return to pre-outbreak hiring rates by the end of the third quarter of 2020. However, the pace of hiring implied by this scenario is extremely high by historical standards given the vast pool of unemployed individuals. In particular, this scenario requires around 9 million hires from unemployment per month during the third quarter, nearly four times faster than the most robust hiring rate during the recovery from the Great Recession.

Our third scenario, “GDP/hiring forecast,” bases hiring projections on the historical relationship between GDP growth and overall exit rates from unemployment to employment or nonparticipation. This requires a GDP forecast. We rely on a recent San Francisco Fed forecast of GDP growth for 2020-21, specifically the more favorable of two alternatives discussed in qualitative terms in Leduc (2020). It assumes that growth bounces back in the second half of this year and continues at a strong pace next year.

Figure 2 shows the unemployment paths for these scenarios. In the historical outflow dynamics scenario (dark blue line), unemployment quickly peaks around 20% and then stays in double digits through early 2021. By contrast, the hiring bounce scenario (light blue line) reflects a stronger recovery in hiring activity, so the unemployment rate drops much more rapidly. At the end of 2020 most of the job losses have been reversed, and unemployment approaches pre-outbreak levels. For the GDP/hiring forecast scenario (yellow line), unemployment peaks above 18% in the second quarter of 2020, followed by a rapid decline in the third quarter due to underlying limited changes in the hiring rate implied by its historical relationship with GDP growth.

Figure 2 Unemployment rate paths under different scenarios

Incorporating unemployment and nonparticipation ambiguities

As noted earlier, widespread shelter-in-place restrictions may preclude active job searches among laid-off workers, causing them to report themselves as out of the labor force rather than unemployed. Consistent with this, the official labor force participation rate fell 2.5 percentage points to 60.2% in April. We explore the potential impact of these measurement challenges through alternative assumptions about flow rates between different labor market states.

In particular, historical patterns of worker flows from employment to nonparticipation then back into employment during recoveries suggest that nearly half of those workers laid off during the pandemic could leave the labor force upon suffering a job loss. This moderates the initial rise in unemployment, shown as the lower participation scenario (red line) in Figure 2. As individuals return to the labor market during the recovery, lifting the labor force participation rate back toward its previous trend, the pace of return to a pre-outbreak unemployment rate is also muted. In fact, the historical outflow dynamics and lower participation scenarios converge at 8% unemployment in mid-2021. However, these two scenarios imply vastly different trajectories for the labor force participation rate. Figure 3 shows the paths for these scenarios over an extended time frame relative to the trend projected by the Congressional Budget Office (2020).

Figure 3 Labor force participation rate under different scenarios

Conclusions: An uncertain road to recovery

The COVID-19 pandemic has created tremendous labor market disruptions and profound hardship throughout the United States and the world. This is partly reflected in the sudden unprecedented increase in the U.S. unemployment rate in April, the first month for which the full effects of coronavirus containment measures are evident. To get a handle on the severity of the labor market disruption, we assess possible paths for unemployment through the end of 2021. Tremendous uncertainty surrounds unemployment projections over the next few years, so we do not claim that any specific scenario qualifies as “likely.” On the pessimistic side, absent a historically unprecedented burst of hiring, the unemployment rate could remain in double digits through 2021. From a more optimistic perspective, if shutdowns are lifted quickly and employers capitalize on the large pool of available workers by ramping up hiring, the unemployment rate could be back down near its pre-outbreak level by mid-2021.

Uncertainty about the path of the unemployment rate also reflects measurement challenges arising from the ambiguous labor force status of laid-off workers whose active job search is limited by shelter-in-place measures. This may temper the official unemployment rate, but at the expense of a lower labor force participation rate, which is an alternative indicator of labor market dislocation and hardship. Given the implied uncertainty about the measurement of future labor market conditions, it is imperative to closely monitor a wide range of indicators to assess how the U.S. labor market is evolving in response to the COVID-19 shock.

Nicolas Petrosky-Nadeau is a vice president in the Economic Research Department of the Federal Reserve Bank of San Francisco.

Robert G. Valletta is a senior vice president in the Economic Research Department of the Federal Reserve Bank of San Francisco.

Bick, Alexander, and Adam Blandin. 2020. “Real Time Labor Market Estimates during the 2020 Coronavirus Outbreak.” Manuscript, Arizona State University, April 15.

Coibion, Olivier, Yuriy Gorodnichenko, and Michael Weber. 2020. “Labor Markets During the COVID-19 Crisis: A Preliminary View.” BFI Working Paper, Becker Friedman Institute for Economics, University of Chicago, April 13.

Congressional Budget Office. 2020. “The Budget and Economic Outlook: 2020 to 2030.” Report 56020, January 28.

Faria-e-Castro, Miguel. 2020. “Back-of-the-Envelope Estimates of Next Quarter’s Unemployment Rate.” On the Economy, FRB St. Louis blog, March 24.

Leduc, Sylvain. 2020. “FedViews.” FRB San Francisco, April 6.

Petrosky-Nadeau, Nicolas, and Robert G. Valletta. 2020. “Unemployment Paths in a Pandemic Economy.” FRB San Francisco Working Paper 2020-18, May.

Şahin, Ayşegül, and Christina Patterson. 2012. “The Bathtub Model of Unemployment: The Importance of Labor Market Flow Dynamics.” Liberty Street Economics, FRB New York blog, March 28.

Wolfers, Justin. 2020. “The Unemployment Rate Is Probably Around 13%.” New York Times (The Upshot), April 16.

Opinions expressed in FRBSF Economic Letter do not necessarily reflect the views of the management of the Federal Reserve Bank of San Francisco or of the Board of Governors of the Federal Reserve System. This publication is edited by Anita Todd and Karen Barnes. Permission to reprint portions of articles or whole articles must be obtained in writing. Please send editorial comments and requests for reprint permission to [email protected]

COVID crisis to push global unemployment over 200 million mark in 2022

A hospital kitchen worker in France prepares meals for patients.

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The economic crisis caused by the COVID pandemic is expected to contribute to global unemployment of more than 200 million people next year, with women and youth workers worst-hit, UN labour experts said on Wednesday.

The International Labour Organization ( ILO ) also maintained in a new report that although the world’s nations “will emerge” from the ongoing health crisis, “five years of progress towards the eradication of working poverty have been undone” nonetheless.

The labour market crisis created by the #COVID19 pandemic is far from over. Employment growth will be insufficient to make up for the losses suffered until at least 2023. Check out the new ILO WESO Trends report: https://t.co/frEhP1ktgS pic.twitter.com/CeRaO0O0gm International Labour Organization ilo

“We’ve gone backwards, we’ve gone backwards big time,” said ILO Director-General Guy Ryder. “Working poverty is back to 2015 levels; that means that when the 2030 Sustainable Development Agenda was set, we’re back to the starting line.”

The worst-affected regions in the first half of 2021 have been Latin America and the Caribbean, Europe and Central Asia, all victims of uneven recovery.

They’ve seen estimated working-hour losses exceed eight per cent in the first quarter and six per cent in the second quarter, far higher than the global average (of 4.8 and 4.4 per cent respectively).

Women’s roles questioned

Women have been hit “disproportionately” by the crisis, seeing a five per cent employment fall in 2020, compared to 3.9 per cent for men.

“A greater proportion of women also fell out of the labour market, becoming inactive,” ILO said, noting that “additional domestic responsibilities” had resulted from lockdowns which risked a “re-traditionalization” of gender roles.

Youth employment has also continued to suffer the economic downturn, falling 8.7 per cent in 2020, compared with 3.7 per cent for adults.

The most pronounced fall has been in middle-income countries where the consequences of this delay and disruption to the early labour market experience of young people “could last for years”, ILO warned.

$3.20 a day

Pandemic-related disruption has also brought “catastrophic consequences” for the world’s two billion informal sector workers.

Compared to 2019, an additional 108 million workers worldwide are now categorized as “poor” or “extremely poor” – meaning that they and their families live on the equivalent of less than $3.20 per person, per day.

“While signs of economic recovery are appearing as vaccine campaigns are ramped up, the recovery is likely to be uneven and fragile,” Mr Ryder said, as ILO unveiled its forecast that global unemployment will reach 205 million people in 2022, up from 187 million in 2019.

The Geneva-based organization also projected a “jobs gap” increase of 75 million in 2021, which is likely to fall to 23 million in 2022 – if the pandemic subsides.

The related drop in working-hours, which takes into account the jobs gap and those working fewer hours, amounts to the equivalent of 100 million full-time jobs in 2021 and 26 million in 2022.

Young employees at a tech company in Ankara, Turkey, focus on digital marketing and computer services.

“This shortfall in employment and working hours comes on top of persistently high pre-crisis levels of unemployment, labour underutilization and poor working conditions,” ILO said in World Employment and Social Outlook: Trends 2021, (WESO Trends) .

The ILO report maintained that although global employment recovery should accelerate in the second half of 2021, it will likely be an uneven recovery.

Unequal vaccine access is to blame, ILO insisted, in addition to the limited capacity of most developing and emerging economies to support the strong fiscal stimulus measures that have characterised the approach of the world’s wealthiest countries to the COVID-induced downturn.

Decent jobs essential

“Without a deliberate effort to accelerate the creation of decent jobs, and support the most vulnerable members of society and the recovery of the hardest-hit economic sectors, the lingering effects of the pandemic could be with us for years in the form of lost human and economic potential and higher poverty and inequality,” said Mr. Ryder. “We need a comprehensive and co-ordinated strategy, based on human-centred policies, and backed by action and funding. There can be no real recovery without a recovery of decent jobs.”

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Unemployment among young workers during COVID-19

Subscribe to the economic studies bulletin, stephanie aaronson and stephanie aaronson senior associate director, division of research and statistics - federal reserve board francisca alba francisca alba former research analyst - economic studies.

September 10, 2020

10 min read

On June 8, the Business Cycle Dating Committee officially declared that the United States entered a recession in February. Young workers are typically hard hit in recessions, and research suggests that entering the labor market during a recession has a negative impact on future earnings and job prospects. In this post we examine the labor market experience of young workers since the onset of the pandemic and provide some thoughts on policy implications.

While the aggregate unemployment rate increased by 11.2 percentage points between February and April of this year (the local peak), unemployment rates among young workers increased by much more. For example, over the same time period, the unemployment rate for those aged 16-19 increased by 20.9 percentage points. The result is that while young people age 16-29 make up less than a quarter of the labor force, they accounted for about a third of the rise in the unemployment rate between February and April of this year. We also find disparities among young workers by education and by race, with Black and Hispanic workers and workers with lower levels of education experiencing larger increases in unemployment rates between February and April compared to white and college-educated workers. Moreover, we find that while between April and July the unemployment rates for young white 1 , and to a lesser extent Hispanic, workers have retraced a good part of their initial rise, the unemployment rate for young Black workers remains particularly elevated and was little changed in June and July.

That young workers have experienced a greater rise in unemployment during the recession is not surprising, as this is typically the case. However, the extent to which young workers are bearing the brunt of the downturn is unusual. This is partly attributable to the fact that, as is typically the case, younger workers were more likely to be laid off in both April and in May 2 , within industries, compared to their older counterparts. Moreover, this pattern has been exacerbated by the fact that, prior to the pandemic, young workers were more likely to work in service industries that were heavily impacted by social distancing policies required to slow the spread of the virus and reductions in consumer spending.

LABOR FORCE STATISTICS BY AGE:

Figure 1 shows the unemployment rate for five groups by age: 16+ (the aggregate unemployment rate widely reported in the media), 16-19, 20-24, and 25-29. As shown, the aggregate unemployment rate rose 11.2 percentage points between February and April (the local peak). Meanwhile, the unemployment rate for the young increased by about 13 percentage points on average, with the largest increases occurring among the youngest workers. Between April and July the unemployment rate for the young decreased by an average of about 7 percentage points while the aggregate unemployment rate decreased by 4.5 percentage points; although, the unemployment rate for young workers in July still remains 7 percentage points higher, on average, than the aggregate.

However, the pandemic unemployment rate has understated the extent to which workers are losing jobs , as more of those who have lost jobs have chosen to drop out of the labor force than is typically the case during a recession. Our analysis suggests that this dynamic has been particularly prevalent among young workers. Figure 2 displays the labor force participation rate for these same age groups. While the aggregate labor force participation rate decreased by 3.2 percentage points between February and April, the labor force participation rate for those between the ages of 16 and 29 dropped by about 6 percentage points on average. Moreover, these declines were much larger proportionally and relative to the rise in the unemployment rate, and they have been more sustained. Since April, the labor force participation rate for those between the ages of 16 and 29 has increased by an average of about 1.5 percentage points, similar to the increase in the aggregate.

LABOR FORCE STATISTICS BY RACE AND BY EDUCATION:

Overall, the young have been hit hard by the recession, but the impact also varies by race/ethnicity and education. Figure 3 shows the unemployment rate since the start of the recession for young white, Black, and Hispanic workers. The unemployment rate rose more for young Black and Hispanic workers between February and April 3 . Between April and July, young white and Hispanic workers started to make up ground, as their unemployment rate declined by an average of about 7 percentage points. However, unemployment rates for young Black workers only declined by about 2 percentage points.

The disparities by education are also stark. These data, which are reported only for those over the age of 25 (by which time educational attainment is largely complete) show that the unemployment rate for those with a high school degree or less and for those with some college education rose by more than twice as much as for those with a college degree or more between February and April. Interestingly, since then, the unemployment rate for those with less than a college degree have come down—likely as the industries in which they work have recovered—while the unemployment rate for those with a college degree has been fairly flat. That said, the unemployment rates for these lower skilled workers, especially those with a high school degree or less, remain higher than those with a college degree or more.

RECENT UNEMPLOYMENT BY INDUSTRY:

These results raise the question of why young workers have lost their jobs at much higher rates. The left panel of Figure 5 shows that between March and April, young workers were more likely to be laid off than older age workers in almost every industry, although in a few cases the differences are quite small (and the same dynamic is true between April and May). The differences are especially pronounced in mining, information, wholesale and retail trade, information, education and health services, leisure and hospitality, and other services sectors 4 . These dynamics are similar to those typically observed during a recession. Employers may be more likely to layoff young workers for a variety of reasons, which depend on the culture of the industry, the nature of the work, and the cost structure. For instance, firms may have policies of firing the most recent hires first, as a way to retain the morale and support of long-time workers. In industries that require significant firm-specific knowledge, young workers with lower tenure would likely have less of this, which would make separating them from the firm less of a loss.

However, the pandemic appears to have introduced an additional economic challenge for young workers. As the right panel of Figure 5 shows, in February, prior to the significant decline in economic activity due to the pandemic, young workers were significantly more likely to be working in many of the hardest hit industries, including leisure and hospitality (17.5 percent) and wholesale and retail trade (16.5 percent) compared to their older counterparts (7 percent and 10.8 percent respectively). These industries are not especially sensitive to economic downturns , so this is a dynamic that is unique to the pandemic and is different from a typical recession.

POLICY IMPLICATIONS & DISCUSSION:

In this post we provide evidence that the labor market prospects of young workers have been particularly hard hit by the current economic downturn, and this is especially true for young Black and Hispanic workers and young workers with lower levels of education. Our findings are consistent with research done by our colleagues in the Metropolitan Policy Program who find that the most vulnerable workers are disproportionately young and have less formal education .

The particular economic vulnerability of young workers right now points to the need for policy support. To some extent, young workers benefit from the same policies that that aid the wider public. For example, as young workers tend to spend a higher proportion of their income on rent 5 ,they would disproportionately benefit from an extension of the federal eviction moratorium in the next relief package. However, policymakers should also take into consideration the special circumstances of young workers. For instance, simply extending federal unemployment insurance benefits will not provide enough financial support for young workers. Congress must also continue to waive work history requirements , since many young workers have short work histories or are just entering the labor force and would therefore be ineligible for UI benefits otherwise. Similarly, a portion of young college graduates did not receive stimulus payments 6 —a small but significant omission that policymakers should take into account, if they do another round of payments to households.

But the problems young workers currently face go beyond an immediate economic need. The jobs young workers hold are important stepping-stones in their careers , allowing them to learn valuable work skills and make connections, which can improve their future employment prospects. To the extent that industries such as retail trade, and leisure and hospitality undergo significant transformations in response to the pandemic, some young workers might find that traditional pathways into the labor market are unavailable.

For those who get a college degree, research suggests that graduating during a recession can leave a lasting imprint. For instance, nearly 1/3 rd of college graduates who entered the labor market during the Great Recession ended up in jobs that did not require a college education. Although this is often a temporary phenomenon, it can have long-lasting implications. For example, research shows that college graduates who have the lowest predicted earnings (based on college and major) suffer the most during a typical recession: experiencing a loss of 8 percent of cumulative earnings in their first 10 years.

All this means that, as we look beyond the pandemic, young workers will need added support to make sure that they are integrated into the labor force.

Becca Portman contributed to the graphics/data visualization for this blog.

U.S. Department Of Labor Publishes Guidance on Pandemic Unemployment Assistance

WASHINGTON, DC – The U.S. Department of Labor today announced the publication of Unemployment Insurance Program Letter (UIPL) 16-20 providing guidance to states for implementation of the Pandemic Unemployment Assistance (PUA) program. Under PUA, individuals who do not qualify for regular unemployment compensation and are unable to continue working as a result of COVID-19, such as self-employed workers, independent contractors, and gig workers, are eligible for PUA benefits. This provision is contained in Section 2102 of the Coronavirus Aid, Relief, and Economic Security Act (CARES) Act enacted on March 27, 2020.

PUA provides up to 39 weeks of benefits to qualifying individuals who are otherwise able to work and available for work within the meaning of applicable state law, except that they are unemployed, partially unemployed, or unable or unavailable to work due to COVID-19 related reasons, as defined in the CARES Act. Benefit payments under PUA are retroactive, for weeks of unemployment, partial employment, or inability to work due to COVID-19 reasons starting on or after January 27, 2020. The CARES Act specifies that PUA benefits cannot be paid for weeks of unemployment ending after December 31, 2020.

Eligibility for PUA includes those individuals not eligible for regular unemployment compensation or extended benefits under state or federal law or pandemic emergency unemployment compensation (PEUC), including those who have exhausted all rights to such benefits. Covered individuals also include self-employed individuals, those seeking part-time employment, and individuals lacking sufficient work history. Depending on state law, covered individuals may also include clergy and those working for religious organizations who are not covered by regular unemployment compensation.

The UIPL also includes guidance to states about protecting unemployment insurance program integrity. The department is actively working with states to provide benefits only to those who qualify for such benefits.

For more information on UIPLs or previous guidance, please visit: https://wdr.doleta.gov/directives/ .

For department resources on COVID-19, please visit: https://www.dol.gov/coronavirus .

For more information about COVID-19, please visit: https://www.cdc.gov/coronavirus/2019-ncov/index.html .

The Employment and Training Administration administers federal job training and dislocated worker programs, federal grants to states for public employment service programs, and unemployment insurance benefits. These services are primarily provided through state and local workforce development systems.

The mission of the department is to foster, promote, and develop the welfare of the wage earners, job seekers, and retirees of the United States; improve working conditions; advance opportunities for profitable employment; and assure work-related benefits and rights.

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Federal Pandemic Unemployment Compensation (FPUC)

Pandemic unemployment assistance (pua), pandemic emergency unemployment compensation (peuc), states got more flexibility to pay benefits.

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Government & Policy

Federal Pandemic Unemployment Programs: How They Worked

These 3 temporary programs provided extra benefits, including $600 more per week

More than 10 million Americans applied for unemployment benefits in March 2020—some 6.6 million of them in the week ending March 28 alone. In April 2020, the unemployment rate soared to 14.7%, “the highest rate and the largest over-the-month increase in the history of the data (available back to January 1948),” according to the U.S. Bureau of Labor Statistics. “The number of unemployed persons rose by 15.9 million to 23.1 million in April.”

To put that into perspective, the unemployment rate hit 10% just once during the Great Recession of 2008, the last major financial crisis to grip the United States. The numbers were the most dire since the Great Depression .

Millions of out-of-work Americans depended on unemployment insurance (UI) to help cover rent, groceries, and other expenses. Several new programs were created to help alleviate some of the economic pain caused by COVID-19, thanks to a $2 trillion coronavirus emergency stimulus package called the Coronavirus Aid, Relief, and Economic Security (CARES) Act that then-President Donald Trump signed into law on March 27, 2020.

The CARES Act expanded unemployment insurance benefits to many workers affected by COVID-19 through three key programs: the Federal Pandemic Unemployment Compensation (FPUC) program, the Pandemic Unemployment Assistance (PUA) program, and the Pandemic Emergency Unemployment Compensation (PEUC) program. Here is a look at these programs and how they helped unemployed Americans affected by coronavirus.

Key Takeaways

The Coronavirus Aid, Relief, and Economic Security (CARES) Act expanded unemployment insurance benefits to many workers affected by COVID-19, the illness caused by coronavirus, through three key programs.
The Federal Pandemic Unemployment Compensation (FPUC) program provided an extra $600 weekly benefit on top of your regular unemployment insurance (UI) if you couldn’t work due to COVID-19.
The Pandemic Unemployment Assistance (PUA) program expanded UI eligibility to self-employed workers, freelancers, independent contractors, and part-time workers impacted by the coronavirus pandemic.
The Pandemic Emergency Unemployment Compensation (PEUC) program extended UI benefits for an extra 13 weeks.
Most states recommended applying for UI benefits online.

The CARES Act established the Federal Pandemic Unemployment Compensation (FPUC) program to boost benefits for out-of-work Americans. Under this new program, eligible people who collected certain unemployment insurance benefits—including regular unemployment compensation—got an extra $600 in federal benefits each week through July 31, 2020. After a series of extensions, the program expired on Sept. 6, 2021. In total, an additional 40 weeks were added to the original 13 weeks of extended benefits.

FPUC was a flat amount given to people who were receiving unemployment insurance, including those who got a partial unemployment benefit check. This program also applied to people who received benefits under the new Pandemic Unemployment Assistance (PUA) program, which covered freelancers, independent contractors, and gig workers (see below).

Under the CARES Act, states that waived their usual one-week waiting period for benefits were fully reimbursed by the federal government for benefits paid that week, plus any associated administrative expenses.

Applying for Federal Pandemic Unemployment Compensation

To apply for Federal Pandemic Unemployment Compensation, people had to file a claim for regular benefits with the UI program in the state where they worked. Depending on the state, they could file a claim in person, online, or over the phone. When they filed a claim, they had to provide their Social Security number, contact information, and details about their former employment.

Under the FPUC program, states administered an extra $600 weekly payment to eligible people who were receiving regular unemployment benefits (including Unemployment Compensation for Federal Employees and Unemployment Compensation for Ex-Servicemembers), as well those collecting benefits from the following programs:

Extended benefits
Short-Time Compensation
Trade Readjustment Allowances
Disaster Unemployment Assistance
Payment under the Self-Employment Assistance program

Due to the massive number of people trying to apply for UI benefits, many states’ UI websites crashed or were very slow. Applicants were advised to watch for updates on the program website, and to be aware that many states had indicated they would backdate claims to the date when applicants first became unemployed.

As the program launched, most states were still waiting for guidance from the U.S. Department of Labor to implement the program (and the other two programs as well). As states started to provide the extra payment, eligible people received retroactive payments. The payments dated back to the applicant’s eligibility date or the date when their state signed an agreement to provide the benefits—whichever was later. All states had executed agreements with the U.S. Department of Labor as of March 28, 2020.

FPUC, PUA, and PEUC were fully federally funded programs. States also received additional administrative funds to operate these programs.

The Pandemic Unemployment Assistance (PUA) program temporarily extended unemployment benefits to eligible self-employed workers, including:

Freelancers and independent contractors
Workers seeking part-time work
Workers who don’t have a long-enough work history to qualify for state unemployment insurance benefits
Workers who otherwise wouldn’t qualify for benefits under state or federal law

The program expired on Sept. 6, 2021, along with other employment-related programs that provided COVID relief.

Pandemic Unemployment Assistance Eligibility

To be eligible for Pandemic Unemployment Assistance, applicants had to provide self-certification that they were able to work and available for work, and that they were unemployed, partially employed, or unable or unavailable to work due to one of these COVID-19-related situations:

They have been diagnosed with COVID-19 or have symptoms of it and are trying to get diagnosed
A member of their household has been diagnosed with COVID-19
They are providing care for someone diagnosed with COVID-19
They are providing care for a child or other household member who can’t go to school or work because it’s closed due to COVID-19
They are quarantined or have been advised by a healthcare provider to self-quarantine
They were scheduled to start a job and don’t have a job or can’t reach the job due to COVID-19
They have become the primary earner for a household because the head of household has died as a direct result of COVID-19
They had to quit their job as a direct result of COVID-19
Their place of employment has closed as a direct result of COVID-19
They meet other criteria set forth by the Secretary of Labor

Workers were not eligible for PUA benefits if they could telework with pay. Also, workers had to be authorized to work to be eligible for PUA, so undocumented workers did not qualify.

Benefit amounts were calculated based on previous earnings, using a formula from the Disaster Unemployment Assistance program under the Stafford Act. PUA had a minimum benefit that was equal to 50% of the state’s average weekly UI benefit (about $190 per week).

Since it could take time for states to be ready to process claims for freelancers, gig workers, and independent contractors, workers were eligible for retroactive benefits and could receive benefits for up to 39 weeks, including any weeks when the worker received regular unemployment insurance.

The program started on Jan. 27, 2020, and was set to expire on Dec. 31, 2020, under the CARES Act. It was extended until March 14, 2021, when the Consolidated Appropriations Act was signed into law on Dec. 27, 2020.

PUA was given new life again, adding 29 more weeks to the program after the Biden administration passed the American Rescue Plan Act , a $1.9 trillion stimulus package, in March 2021. PUA officially expired on Sept. 6, 2021, after a total of 79 weeks.

The Pandemic Emergency Unemployment Compensation (PEUC) program allowed people who had exhausted their regular unemployment benefits to receive up to 13 additional weeks of benefits.

States had to offer flexibility to applicants in meeting PEUC eligibility requirements related to “actively seeking work” if an applicant’s ability to find work was affected by COVID-19. The bill specifies that “a State shall provide flexibility in meeting such [work search] requirements in case of individuals unable to search for work because of COVID-19, including because of illness, quarantine, or movement restriction.”

After a series of extensions, the program also expired on Sept. 6, 2021. In total, an additional 40 weeks were added to the original 13 weeks of extended benefits.

A “non-reduction” rule in the CARES Act prevents states from doing anything to decrease the maximum number of weeks of unemployment insurance or the weekly benefits available under state law as of Jan. 1, 2020.

Federal law allowed considerable flexibility for states to amend their laws to provide unemployment insurance benefits in several COVID-19-related situations. States could, for example, pay benefits when:

An employer temporarily closes due to COVID-19, preventing employees from going to work
A person is quarantined and anticipates going back to work after the quarantine is over
A person stops work due to a risk of COVID-19 exposure or infection, to care for a family member, or to homeschool their children

Under federal law, an employee didn’t have to quit to receive benefits due to COVID-19.

To find out the rules in their state, applicants should check with their state’s unemployment insurance program .

Which pandemic unemployment program covered freelancers and part-time workers?

The Pandemic Unemployment Assistance (PUA) program covered these categories. Workers had to fit into one of 10 COVID-19-affected categories.

Could people whose workplaces closed temporarily for COVID get unemployment compensation?

The laws allowed states to include these groups in unemployment compensation. The affected workers didn’t have to lose their jobs to be covered.

When did these special programs end?

All three expired on Sept. 6, 2021.

Three special unemployment compensation programs helped workers survive the job loss and financial strain of the coronavirus pandemic in the United States from the end of March 2020 until early September 2021. They included unique features such as covering self-employed workers, freelancers, independent contractors, and part-time workers—and those who left their jobs to care for people affected by COVID-19 or children sent home when schools closed due to the pandemic. They also provided additional payments and a longer time frame for unemployment.

The Washington Post. “ Over 10 Million Americans Applied for Unemployment Benefits in March as Economy Collapsed .”

U.S. Bureau of Labor Statistics. “ Unemployment Rises to Record High 14.7 Percent in April 2020 .”

U.S. Bureau of Labor Statistics. “ Graphics for Economic News Releases: Civilian Unemployment Rate .”

U.S. Bureau of Labor Statistics. “ Labor Force, Employment, and Unemployment, 1929–39: Estimating Methods ,” Page 2, Table 1.

U.S. Department of the Treasury, Office of Inspector General. “ CARES Act .”

Congress.gov, U.S. Congress. “ H.R.748—CARES Act; Summary .”

U.S. Department of Labor. “ U.S. Department of Labor Announces New CARES Act Guidance on Unemployment Insurance for States in Response to COVID-19 Crisis .”

New York State Department of Labor. “ Expiration of Federal Unemployment and Pandemic Benefits .”

U.S. Department of Labor. “ U.S. Department of Labor Announces New Guidance to States on Unemployment Insurance Programs .”

U.S. Department of Labor Blog. “ New COVID-19 Unemployment Benefits: Answering Common Questions .”

U.S. Department of Labor. “ U.S. Department of Labor Publishes Guidance on Federal Pandemic Unemployment Compensation .”

U.S. Department of Labor. “ Advisory: Unemployment Insurance Program Letter No. 14-20 ,” Pages 3–5 and 8.

U.S. Department of Labor. “ U.S. Department of Labor Issues New Guidance to States on Implementing American Rescue Plan Act Unemployment Insurance Provisions .”

Congress.gov, U.S. Congress. “ H.R.748—CARES Act: Text .”

National Employment Law Project. “ Unemployment Insurance Provisions in the Coronavirus Aid, Relief, and Economic Security (CARES) Act .”

Congress.gov, U.S. Congress. “ H.R.1319—American Rescue Plan Act of 2021: Text .”

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New COVID-19 Unemployment Benefits: Answering Common Questions

In March 2020, the president signed the Coronavirus Aid, Relief and Economic Security (CARES) Act, which provided Americans with new and expanded unemployment insurance (UI) benefits if they’re out of work for reasons related to the pandemic. These benefits were recently updated and extended when the Continued Assistance for Unemployed Workers Act of 2020 (Continued Assistance Act) was signed into law by President Trump on Dec. 27, 2020. The Continued Assistance Act also included a one-time $600 stimulus payment for qualified individuals; however, that payment is not an unemployment benefit and is administered by the U.S. Department of the Treasury.

Here are answers to questions about the unemployment insurance benefits in the new law.

How does the Continued Assistance Act affect unemployment benefits?

* minus the weeks you received regular unemployment benefits and extended benefits

If you are receiving unemployment benefits [state or federal regular unemployment compensation, including Unemployment Compensation for Federal Employees (UCFE), Unemployment Compensation for Ex-Servicemembers (UCX), PEUC, PUA, Extended Benefits (EB), Short-Time Compensation (STC), Trade Readjustment Allowances (TRA), Disaster Unemployment Assistance (DUA), or the Self-Employment Assistance Program (SEA)], you will receive an additional $300 per week as a supplemental amount to unemployment benefits for weeks of unemployment ending by March 14, 2021.

PUA still applies to self-employed workers, gig workers, independent contractors, and other people who don’t usually qualify for unemployment insurance. The PUA program is extended to March 14, 2021. If you receive PUA during the week ending March 14, 2021, have not exhausted all rights to PUA, and are otherwise eligible for PUA benefits, there is a transition period through weeks of unemployment that begin no later than April 5, 2021, for which PUA benefits are payable. No PUA is payable for any week of unemployment beginning after April 5, 2021. In addition, the maximum PUA eligibility has been extended from 39 weeks to 50 weeks (minus the weeks the individual received regular unemployment benefits and Extended Benefits).

Similarly, the PEUC program is extended to March 14, 2021. If you receive PEUC during the week ending March 14, 2021, have not exhausted all rights to PEUC, and are otherwise eligible for PEUC, there is a transition period through weeks of unemployment that begin no later than April 5, 2021, for which PEUC benefits are payable. No PEUC is payable for any week of unemployment beginning after April 5, 2021. In addition, the length of time an eligible individual can receive PEUC has been extended from 13 weeks to 24 weeks.

Note that individuals in states where the Extended Benefits program is available may receive up to 13 weeks of benefits — or up to 20 weeks of benefits if the state is in a high unemployment period — through the EB program. Contact your state unemployment insurance agency for more information .

How many weeks of unemployment insurance benefits am I entitled to?

The amount and duration of benefits you can receive also depends on the law in the state where you last worked . The state will determine your eligibility for any additional federal benefits. Contact your state unemployment insurance agency for more information .

Do I qualify for the additional $300 in federal benefits?

The additional $300/week in Federal Pandemic Unemployment Compensation is available to claimants receiving unemployment benefits under the state or federal regular unemployment compensation programs (UCFE, UCX, PEUC, PUA, EB, STC, TRA, DUA, and SEA ). The funds are available for any weeks of unemployment beginning after Dec. 26, 2020, and ending on or before March 14, 2021. You don’t need to apply separately to receive this supplemental amount.

Are self-employed, independent contractor and gig workers eligible for assistance?

Self-employed workers, independent contractors, gig economy workers, and people who have not worked long enough to qualify for the other types of unemployment assistance may still qualify for PUA if they are otherwise able to work and available for work within the meaning of the applicable state law and certify that they are unemployed, partially unemployed or unable or unavailable to work for one of the following COVID-19 reasons:

You have been diagnosed with COVID-19, or have symptoms, and are seeking a medical diagnosis.
A member of your household has been diagnosed with COVID-19.
You are caring for a family member of a member of your household who has been diagnosed with COVID-19.
A child or other person in your household for whom you have primary caregiving responsibility is unable to attend school or another facility that is closed as a direct result of COVID-19 and the school or facility care is required for you to work.
You cannot reach your job because of a quarantine imposed as a direct result of the COVID-19 public health emergency.
You cannot reach your job because you have been advised by a healthcare provider to self-quarantine due to concerns related to COVID-19.
You were scheduled to start a new job and do not have a job or are unable to reach the job as a direct result of the COVID-19 public health emergency.
You’ve become the main source of income for a household because the head of the household has died as a direct result of COVID-19.
You had to quit your job as a direct result of COVID-19.
Your workplace is closed as a direct result of COVID-19.
You are self-employed, have reportable income and have experienced a significant diminution of services because of the COVID-19 public health emergency.

States must first verify that these workers are not eligible for regular unemployment compensation or Extended Benefits under state or federal law or PEUC. Beginning on Jan. 26, 2021, states must also implement stricter identification verification measures for PUA applicants. Applicants will also be required to provide documentation substantiating employment or self-employment.

What can I do if somebody filed a fraudulent claim using my information?

Contact our Office of Inspector General to report claimant or employer fraud involving unemployment insurance:

Online : www.oig.dol.gov/hotline.htm

Phone : 1-800-347-3756

You can also contact the fraud office for the state where the claim was filed. Check this list to find contact information for your state unemployment insurance fraud office .

Can you help if my state office won’t answer the phone or hasn’t sent my money?

We recognize that a high volume of pandemic-related calls has overwhelmed some states’ call centers and websites, leading to delays. However, the federal government has no authority to intervene in individual claims for benefits, so you should contact the state unemployment insurance office handling your claim. You can locate state office information at www.dol.gov/uicontacts .

Find more information about unemployment insurance generally and more information about unemployment insurance relief during the COVID-19 outbreak , including contact information for your state unemployment insurance office.

Jim Garner is the acting administrator of the Office of Unemployment Insurance in the U.S. Department of Labor’s Employment and Training Administration .

Unemployment Insurance
Federal Pandemic Unemployment Compensation
Pandemic Unemployment Assistance
Pandemic Emergency Unemployment Compensation
Continued Assistance Act
Employment and Training Administration (ETA)

5 charts that explain how COVID-19 has affected employment in OECD countries

shown here are people in Rome, Italy wearing masks during the pandemic

"...the pandemic has presented governments with a chance to address all of these issues as vaccination programmes bring the hope of recovery." Image: UNSPLASH/Gabriella Clare Marino

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Coronavirus and the measures to contain it caused a severe global economic recession.
Those with less formal education, on low pay, women and the young were more likely to lose their jobs.
Governments have committed exceptional resources to recovery, offering an opportunity to build a more equitable jobs market.

Covid-19 has had a shattering effect on the world of work and in many countries it continues to do so.

Measures put in place to contain the virus have caused severe economic pain. Lockdowns closed businesses, cost jobs and required billions to isolate at home, away from extended family and friends.

Inequalities in society that predated the pandemic worsened. The gender pay gap has widened , youth unemployment has increased and many employed on insecure contracts have lost their jobs.

But the pandemic has presented governments with a chance to address all of these issues as vaccination programmes bring the hope of recovery. Instead of returning to the life we had before the pandemic, some policy makers think now’s the time to invest in jobs that offer security, better prospects and higher pay.

When will jobs be back?

The pandemic prompted governments and central banks to provide unprecedented stimulus to protect jobs; the OECD estimates that 21 million jobs were saved in this way. But what happens when that safety net is removed?

The OECD's 2021 Employment Outlook suggests that even across the world’s richest countries, the bounce back to pre-pandemic employment rates will be patchy. Israel, for instance, isn’t expected to see jobs return to 2019 levels until 2025, four years after Australia.

this chart shows that the OECD predicts an uneven return to pre-pandemic employment levels.

Long-term unemployed struggle to find work

The downturn in many OECD economies has resulted in more job seekers being out of work for longer than they might have expected before the pandemic.

That may pose problems for future employment because the longer a person is out of work the harder it is for them to find a job.

this chart shows how periods of unemployment have grown longer during the pandemic

Unemployment is higher than in 2019

While unemployment has begun to lessen, it has yet to fall to pre-pandemic levels. Additionally, job losses have been disproportionately higher among the young, those on lower pay and workers in industries most troubled by shutdowns, such as hospitality. These are also traditionally roles with the least protections.

this chart shows how unemployment remains stubbornly high among OECD nations.

The youth employment gap is growing

The employment gap between people aged 15-to-24 and older workers has been widening for decades, but the past year has seen the chasm deepen. A greater proportion of jobs were lost among young people, who have also been less able to find work.

Youth unemployment and underemployment (when people would like to work for more hours than they do) particularly affects women, those from disadvantaged backgrounds and minority groups. Left unchecked, this could aggravate social exclusion, potentially fuelling unrest, the OECD warns.

Have you read?

6 ways to ensure a fair and inclusive economic recovery from covid-19, how coronavirus has hit employment in g7 economies, when will the covid-19 pandemic end experts explain.

this chart shows how young people have been hit hard by unemployment and will see a slower recovery.

Not everyone can work remotely

Many people took the opportunity to work from home during pandemic lockdowns, swapping an early commute for another hour in bed. Others, especially in lower-paid and labour-intensive industries didn’t have that choice and had to go to work as usual. This affected the less educated to a greater degree than college graduates.

this chart shows that working from home was not an option for many during the pandemic

A different future

The economic hit to the global economy from coronavirus was worse even than the 2008 recession, with the OECD estimating that more than 110 million jobs have been lost.

this diagram shows how the Covid-19 pandemic has hit jobs in OECD countries and around the world.

Governments are moving from their initial crisis response into long-term recovery plans. This year support for people seeking work increased in 53% of countries.

However International Monetary Fund (IMF) data indicates economic recovery is affected by the country you call home. Next year’s economic forecast is revised up for developed nations with vaccines, while developing economies, especially in Asia have been downgraded.

The first global pandemic in more than 100 years, COVID-19 has spread throughout the world at an unprecedented speed. At the time of writing, 4.5 million cases have been confirmed and more than 300,000 people have died due to the virus.

As countries seek to recover, some of the more long-term economic, business, environmental, societal and technological challenges and opportunities are just beginning to become visible.

To help all stakeholders – communities, governments, businesses and individuals understand the emerging risks and follow-on effects generated by the impact of the coronavirus pandemic, the World Economic Forum, in collaboration with Marsh and McLennan and Zurich Insurance Group, has launched its COVID-19 Risks Outlook: A Preliminary Mapping and its Implications - a companion for decision-makers, building on the Forum’s annual Global Risks Report.

Companies are invited to join the Forum’s work to help manage the identified emerging risks of COVID-19 across industries to shape a better future. Read the full COVID-19 Risks Outlook: A Preliminary Mapping and its Implications report here , and our impact story with further information.

The International Labour Organization (ILO) is asking policy makers to take the long view. In its Global Call to Action the ILO argues jobs recovery plans need to be inclusive, with specific support to help disadvantaged groups. For the recovery to last, policy makers must include excellent training programmes with a focus on investing in well-paid, quality jobs.

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World Economic Forum articles may be republished in accordance with the Creative Commons Attribution-NonCommercial-NoDerivatives 4.0 International Public License, and in accordance with our Terms of Use.

The views expressed in this article are those of the author alone and not the World Economic Forum.

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Analysis of the COVID-19 impacts on employment and unemployment across the multi-dimensional social disadvantaged areas

This is the study of economic impacts in the context of social disadvantage. It specifically considers economic conditions in regions with pre-existing inequalities and examines labor market outcomes in already socially vulnerable areas. The economic outcomes remain relatively unexplored by the studies on the COVID-19 impacts. To fill the gap, we study the relationship between the pandemic-caused economic recession and vulnerable communities in the unprecedented times. More marginalized regions may have broader economic damages related to the pandemic. First, based on a literature review, we delineate areas with high social disadvantage. These areas have multiple factors associated with various dimensions of vulnerability which existed pre-COVID-19. We term these places “ multi-dimensional social disadvantaged areas ”. Second, we compare employment and unemployment rates between areas with high and low disadvantage. We integrate geospatial science with the exploration of social factors associated with disadvantage across counties in Tennessee which is part of coronavirus “red zone” states of the US southern Sunbelt region. We disagree with a misleading label of COVID-19 as the “great equalizer”. During COVID-19, marginalized regions experience disproportionate economic impacts. The negative effect of social disadvantage on pandemic-caused economic outcomes is supported by several lines of evidence. We find that both urban and rural areas may be vulnerable to the broad social and economic damages. The study contributes to current research on economic impacts of the COVID-19 outbreak and social distributions of economic vulnerability. The results can help inform post-COVID recovery interventions strategies to reduce COVID-19-related economic vulnerability burdens.

1. Introduction: social disadvantage

Pandemics create severe disruptions to a functioning society. The economic and social disruptions intersect in complex ways and affect physical and mental health and illness ( Wu et al, 2020 ). Additionally, loss of jobs, wages, housing, or health insurance, as well as disruption to health care, hospital avoidance, postponement of planned medical treatment increase mortality, e.g., premature deaths ( Kiang et al., 2020 ; Petterson et al., 2020 ). The COVID-19, misleadingly labelled the “great equalizer” implies everyone is equally vulnerable to the virus, and that the economic activity of almost everyone is similarly impacted regardless of social status ( Jones & Jones, 2020 ). We set out to answer whether economic vulnerability is equally distributed during the COVID-19-caused economic recession or whether is it based on structural disadvantages? Is the social distribution of economic vulnerability magnified in regions with pre-existing social disparities, thus, creating new forms of inequalities? Knowledge of what areas experience the greater economic burden will help identify the most economically vulnerable communities relevant to post-COVID recovery interventions ( Qian and Fan, 2020 ).

Current studies on the impacts of COVID-19 largely focus on medical aspects including the COVID diagnosis and treatment ( Cai et al., 2020 ; Kass et al., 2020 ; O’Hearn et al., 2021 ; Price-Haywood et al., 2020 ). Non-medical urban research primarily concentrates on the impact of COVID on cities by studying factors related to environmental quality including meteorological parameters, and air and water quality ( Sharifi and Khavarian-Garmsir, 2020 ). COVID-related socio-economic impacts on cities are relatively less well studied, especially during the later stages of the recession.

Many pre-pandemic disparities unfold during COVID-19. To illustrate, residents of Black and Latino communities are suffering disproportionately higher unemployment rates, greater mortality due to the COVID-19 ( Thebault, Tran, & Williams, 2020 ; Wade, 2020 ), higher hospitalizations ( O’Hearn et al., 2021 ) and financial troubles. In contrast, some attributes make persons and communities more resilient. In China’s context, these include higher worker education and family economic status, membership in Communist Party, state-sector employment, and other traditional markers. These factors protect people from the pandemic-related financial stress and diminish its adverse economic effects ( Qian and Fan, 2020 ). Building on these recent studies on economic impacts, this social justice research focuses on areas with pre-existing social disadvantages. We study the role of social disadvantage and its impact on labor market during the COVID.

The distribution of economic vulnerability may potentially be related to COVID-19 conditions including those of economic burdens for people living in the pandemic epicenters ( Creţan and Light, 2020 ). Similarly, socio-economic disruptions create “a characteristic mosaic pattern in the region” ( Krzysztofik et al., 2020 , p. 583). The disruptions are strongly correlated with the spatial distribution of the COVID-19-related health effects. This study is set in Tennessee which is part of coronavirus “red zone” states of the US southern Sunbelt region. It is among the U.S. states with the highest rates of cases per capita, with 137,829 cases per 1 million people, or the 6th highest as of August 13, 2021 ( Worldometers, 2020 ; https://www.worldometers.info/coronavirus/country/us/ ). The study seeks to explore the impacts of social disadvantage on economy. The impact is measured by employment and unemployment in unprecedented times in the US context of prolonged disruptions to the health system, society, and economy intersecting in complex ways ( Kiang et al., 2020 ). We answer the following questions: (1) Do communities with high social disadvantage already burdened pre-COVID-19 by the lack of income, healthcare access, lacking resources, have less jobs available during the COVID-19 pandemic? (2) Do these areas simultaneously experience higher unemployment compared with other areas in the context of the pandemic?

The paper is organized as follows: Section 1 introduces the topic, provides the background information on social disadvantage and a brief description of the study implementation. It further discusses the links between employment and unemployment, and coronavirus, respectively, and introduces the study area. Section 2 describes in detail materials and methods used in the study. Section 3 provides the theory and calculations. Section 4 reports the results, and Section 5 offers a discussion. Finally, the paper concludes with conclusions found in Section 6 .

1.1. Background

Certain socio-economic and demographic conditions burden some communities more than others including racial and ethnic minorities, lower-income groups, and rural residents. The conditions include lacking economic opportunities and other inequalities ( Petterson et al., 2020 ) caused by social environment. Prior to the pandemic, it was challenging to live in areas with high social disadvantage where residents already have increased vulnerability to poor health due to greater psychosocial stress such as discrimination, unhealthy behaviors, and poorer health status ( Hajat et al., 2015 ). This is true for poor, marginalized communities elsewhere as spatial segregation of disadvantaged and marginalized communities decreases life opportunities for their members who have limited relationships with broader communities ( Méreiné-Berki et al., 2021 ). Within the context of studying disadvantaged urban communities, a recent work by Creţan et al. (2020) focused on the everyday manifestations of contemporary stigmatization of the urban poor using the case study of the Roma people who have been historically subject to state discrimination, ghettoization, inadequate access to education, housing, and the labor market for many decades in the past in multicultural urban societies of Central and Eastern Europe. The inequalities may persist and even increase if left unaddressed during pandemics ( Wade, 2020 ) leading to stark COVID-19-related health and economic disparities. Indeed, during the COVID-19, economic impacts of the pandemic disproportionately affect marginalized groups. The impact of coronavirus was harsh for those people as many of the already existing disparities unfold during COVID-19: black communities in the United States are disproportionately affected by higher death rates due to the COVID-19 virus ( Thebault et al., 2020 ), unemployment, and financial stress. Other growing COVID-19 research similarly suggests that elsewhere outside of the United States, areas that were disadvantaged prior to the pandemic with high rates of poverty and unemployment tended to be affected the strongest by the COVID-19 with the largest concentration of cases, while other spatially segregated ethnicity-based communities (e.g., the Roma) that have been vulnerable decades prior to COVID-19, saw an increase in the existing discrimination and stigmatization experiencing greater marginalization even during the current COVID-19 pandemic period ( Crețan & Light, 2020 ).

To achieve greater economic stability, and secure a dynamic labor market, countries in the global north and south for several decades have been increasing service employment much of which is low wage. The recent book Corona and Work around the Globe ( Eckert and Hentschke, 2020 ) describes the tremendous impact of the pandemic on human life and livelihoods as it sheds light on various experiences of workers during COVID-19 in various countries. Among the dramatically different cases worldwide, Germany which for decades has been promoting the low-wage sector to combat unemployment, provides a good example. The official approach to handling a disease differed substantially depending on whether the infected individuals were working people from the low- or upper-wage sector of the economy: applying a strict lockdown to the entire high-rise building where ethnic workers lived and preventing them from going to work in the former case and granting permission to work from home in the latter ( Mayer-Ahuja, 2020 ). The plight of the agricultural migrant workers who come to Germany from Eastern and Southeastern Europe, subjected during the pandemic to low wages or no payments and poor working and living conditions, however, is shared among the workers of low-wage sector across all countries who are more likely to get infected due to higher exposure and direct contact, but often experience unfair treatment based on ethnicity, migration and class status.

In yet another case set in the U.K., disadvantaged households have experienced intensified disadvantage during the COVID-19 as they could not access vital necessities, already stretched for resources pre-COVID-19. As provision of services or employment was discontinued due to their closure, disadvantaged households had significant impacts on their income level, mental health and wellbeing, education, nutrition, and domestic violence. In the absence of the key support of public institutions including schools, community centers, and social services, care for the most vulnerable members such as elderly, children, the disabled, have been absorbed by households ( Bear et al., 2020 ).

Another aspect experienced by workers during the pandemic is the total loss of earnings which is especially harsh in places with precarious employment even under normal circumstances. Informal workers in India who represent the vast majority of working population (over 93%), with no social security benefits and absent job security, experienced prolonged periods of time of no work due to lockdown and suspended transport services preventing them from getting to their workplaces, many on the verge of starvation ( Banerjee, 2020 ). This study looks into this aspect of COVID-19 economic impacts and confirms the findings of the growing COVID-19 research.

However, not only the poorest and marginalized people, but also marginalized regions are more likely to suffer from broader social and economic damages related to the pandemic compared with more privileged areas ( Creţan and Light, 2020 ; Krzysztofik et al., 2020 ). When disadvantages combine, it may lead to environment-driven COVID-19-related disparities in health. Besides a direct health effect, disadvantaged communities are disproportionally experiencing other side effects of COVID-19 such as negative labor market outcomes including forced unemployment, loss of income and social isolation. Studies found the extreme vulnerability of cities and urban areas exposed during the global pandemic ( Batty, 2020 ; Gössling et al., 2020 ). We argue that rural areas may be equally vulnerable to the broad range of social and economic damages if there is a spatial concentration of factors related to various dimensions of vulnerability.

This study is situated in the context of social disadvantage. Prior studies developed the methodology of the delineation of disadvantaged residential communities proxied by low-income workers ( Antipova, 2020 ). Disadvantaged low-income workers can be defined as those with inadequate access to material and social resources in the study area. However, this is a narrow approach which uses only a single dimension of a disadvantage, that of worker low earnings and misses other social inequality indicators. Accordingly, an approach adopted in this study identifies areas where socio-economic and demographic attributes each associated with multiple dimensions of social disadvantage are spatially co-locating. Spatial segregation of disadvantaged and marginalized communities decreases life opportunities for their members who have limited relationships with wider communities ( Méreiné-Berki et al., 2021 ). We identify these attributes based on a thorough literature review. Thus, we simultaneously consider multiple factors associated with disadvantage capturing a multi-dimensional social disadvantage. To meet the objective, we integrate geospatial science with the exploration of predictive geographic and social factors associated with disadvantage across counties in TN. The geospatial analysis includes point interpolation within the Geographic Information System (GIS) environment for the generation of a surface from a sample of social disadvantage values. This allowed us to visualize the spatial extent of disadvantaged communities. The focus is on labor market outcomes which are important indicators of society well-being. We study the association between pre-existing inequalities and COVID-19-related employment and unemployment rates. Thus, we identify the role of social disadvantage on labor market conditions in the context of the ongoing pandemic-caused economic recession.

Prior research determined the key metrics of social disadvantage. Conditions contributing to various aspects of disadvantage include poverty, occupations with low earnings, low rent, segregation and discrimination-related residential concentrations of minorities, and exposure to poor air quality ( Bullard, 2000 ). The recent COVID-19-related literature focuses on the separate effect of minorities, Hispanics, crowded households, dense areas, obesity, poverty, air pollution exposure and identifies those as important COVID-19 health risk factors ( Finch & Hernández Finch, 2020 ; Golestaneh et al., 2020 ; Han et al., 2020 ; Millett et al., 2020 ). These community-level variables result in neighborhood disadvantage comprising sub-standard housing quality, crowded conditions, poverty- and violence-caused stress which combined increase the risk of disease and other negative outcomes in life among socially disadvantaged groups ( Malhotra et al., 2014 ). The demographic and socio-economic attributes selected to represent the various aspects of social disadvantage in this research include minorities and ethnicities, poverty, housing crowdedness, educational attainment, underlying population health conditions, and pre-COVID-19 unemployment which may collectively drive a greater vulnerability to the COVID-19 infection and mortality as well as loss in employment and higher unemployment. It is challenging to isolate the separate effects of the multiple risk factors. By “critically analyzing the theoretically intended meaning of a concept” ( Song et al., 2013 ), a composite variable can be created to logically represent a multi-dimensional social disadvantage .

The following subsection briefly describes study implementation. First, we locate areas of disadvantage where multiple factors associated with various aspects of disadvantage co-locate spatially and term these places “multi-dimensional social disadvantaged areas”. Then, we examine how employment and unemployment were impacted in these already socially vulnerable areas. We map geographical inequalities in employment and unemployment rates during the period of COVID-19-related economic recession. For the first objective, we identify socially disadvantaged counties within TN which is part of coronavirus “red zone” states of the US southern Sunbelt region applying consistent criteria. For the second objective, we compare employment and unemployment outcomes between areas with high and low disadvantage.

1.1.1. Employment and coronavirus

This subsection discusses the role of employment and how it was impacted by the COVID-19-caused economic recession. The literature recognizes the complex interrelationship between employment and overall health and well-being. Negative COVID-19 impacts on urban economy include loss of citizens' income, while movement restrictions and ‘stay home’ measures adversely impacted tourism and hospitality and small- and medium sized businesses due to the closure of markets, food outlets and social spaces ( Wilkinson et al., 2020 ).

Millions of essential or blue-collar workers are still doing their jobs out of necessity and because they cannot telecommute and work jobs that cannot be done from home and have higher exposure to the virus. Some racial groups disproportionally have jobs that do not allow them to work from home and where social distancing is a challenge. Prior studies find that workplaces of low-income individuals tend to be close to their residential spaces, and disproportionately concentrated in lower-wage industries such as hospitality and retail services ( Antipova, 2020 ). These industries commonly represent essential services experiencing higher exposure to the COVID virus through workplaces. At the same time, minorities and lower-income groups often live in inner-ring suburbs with older housing and aging infrastructure ( Antipova, 2020 ) in multiunit structures and in multigenerational households which inhibit the ability to practice social distancing increasing the risks of disease occurrence and deaths ( Qualls et al., 2017 ). In addition, minorities and lower-income groups have fewer options for protecting both their health and economic well-being ( Gould and Wilson, 2020 ). Nearly two-thirds of Hispanic people (64.5%) considered at high risk for coronavirus live with at least one person who is unable to work from home, compared to 56.5% of black and less than half (47%) of white Americans, according to a recent study ( Selden and Berdahl, 2020 ).

Despite the pandemic-induced layoffs, job hires have occurred by major retailers such as Walmart and e-commerce giant Amazon, and takeout and delivery-based services such as Domino’s Pizza and Papa John’s which may become permanent positions. These workplaces may match the job skill sets of low-income residents of vulnerable communities. However, oftentimes many low-income workers benefitted less, even when jobs were created during the COVID-19. To illustrate, big technology companies (i.e., communication services: Netflix, Tencent, Facebook, T-Mobile; information technology: Microsoft, Nvidia, Apple, Zoom Video, PayPal, Shopify; consumer discretionary: Amazon, Tesla, Alibaba, etc.) prospered in the pandemic with the financial success measured by equity value added ( Financial Times, 2020 ). Workers who lost jobs in low-income segment such as hospitality sector may be hired by retailers such as Kroger or CVS. However, many others from the communities with high social disadvantage may not have a skill set needed at technology firms that benefit from the working from home trend and hire skilled workers including software engineers and product designers. Cross-industry employment shifts plays a minor role in total job creation, while employer-specific factors primarily account for job reallocation ( Barrero et al., 2020 ).

1.1.2. Unemployment and coronavirus

This subsection discusses how unemployment was impacted by the COVID-19-caused economic recession. An economic recession occurs when there is a substantial drop in overall economic activity diffused throughout the economy for longer than a few months. While past recessions were driven by an inherently economic or financial shock, the current recession is caused by a public health crisis ( Weinstock, 2020 ). COVID-19 caused a drop in consumer demand across all industrial sectors resulting in economic recession and massive unemployment where not only hourly workers but salaried professionals lost their jobs ( Petterson et al., 2020 ). A range of factors contributed to the spatial variation in economic damage including the share of jobs in industries delivering non-essential services to in-person customers ( Dey and Loewenstein, 2020 ), declines in personal consumption caused by individual fears of contracting COVID-19 ( Goolsbee and Syverson, 2020 ), and the implementation of social policies including stay-at-home orders and business shutdowns ( Gupta et al., 2020 ).

Unemployment rate is defined as a percentage of unemployed workers in the total labor force. The rate is published monthly by the Bureau of Labor Statistics (BLS) which uses both the establishment data (captured by the Current Employment Statistics program) and household surveys (Current Population Survey) to generate the labor market data ( Bureau of Labor Statistics (BLS), 2020b ). A person is unemployed if they were not employed during the survey’s reference week and who had actively searched for a job in the 4-week period ending with the reference week, and were presently available for work ( BLS, 2020b ).

Caused by the COVID-19, the unemployment rate reached a peak in April 2020 at 14.7% nationwide, an unprecedented joblessness amount since employment data collection started in 1948. It exceeded the previous peaks during the Great Recession and after ( Falk et al., 2020 ). The official unemployment rate may have been over 20%, since the actual level of joblessness could have been understated due to local unemployment rate measurement errors ( Coibion et al., 2020 ). In addition, the unemployment rate was understated due to a geographically widespread misclassification of those who was not at work but considered employed and non-inclusion of labor force non-participants who still counted as employed ( Bureau of Labor Statistics (BLS), 2020a ). Further, the COVID-19 caused the rapid rate of change in unemployment at the national level challenging accurate forecast of the monthly unemployment rate ( Weinstock, 2020 ).

Overall, current unemployment (using the most recently available county-level data at the time of writing for December 2020) is still elevated and is almost twice as high as it was back in February 2020 which represented the business cycle peak with the peak of payroll employment. March 2020 was the first month of the subsequent current economic recession as declared by The National Bureau of Economic Research (NBER, 2020) caused by the COVID-19 pandemic which turned out the worst downturn after the Great Recession. As Fig. 1 shows using the Current Population Survey data (Series ID: LNS14000000) from the BLS, during the prior recessions the unemployment rate rose gradually reaching its peak, and in the pandemic-caused recession it increased unprecedentedly to its peak over one month, from March 2020 to April 2020 by 10.3% (from 3.5% in February 2020 to 4.4% in March 2020 to 14.7% in April). After that, the rate declined as workers continued to return to work to 6.3% in December 2020.

U.S. Historical unemployment rate for workers 16 years and over, January 1948 to December 2020, % (seasonally adjusted).

Some communities can absorb the impact of economic downturns due to more favorable economic and social factors protecting residents from adversity. Yet other communities are witnessing the effect of rising unemployment in the time of COVID-19. Loss of income and livelihood has further effects: as wages drop, more people are forced into poverty while simultaneously people's health is impacted. Unemployment impacts all-cause mortality. Fig. 2 presents the dynamics of unemployment distribution across counties in TN for the selected months. Shown are pre-COVID-19 unemployment rates as of August 2019 ( Fig. 2 a), followed by May 2020 ( Fig. 2 b) where even the lowest levels of unemployment exceed the highest rates of the pre-pandemic period even in wealthy counties around Nashville (seen in the legend entries), August 2020 ( Fig. 2 c), and September 2020 ( Fig. 2 d). The overall unemployment abates somewhat during the later stage, and the general spatial pattern resembles that of the pre-COVID-19 period with higher unemployment concentrated in the southwestern corner of the state around Memphis.

Dynamics of unemployment rate across counties in TN for selected months: (a) August 2019, (b) May 2020; (c) August 2020; (d) September 2020.

1.1.3. Study area

Tennessee is home to large cities including Nashville (the county seat), Memphis, Knoxville and Chattanooga. Despite urban diversified economy, there was a steep decline in the number of international and domestic tourists impacting urban economy. Among cities listed above, Memphis, located in Shelby County, is a shrinking city with a declining population base. Urban shrinkage makes cities more vulnerable due to very negative impacts on urban economy. Shrinking cities are characterized by higher unemployment rates, depopulation (as people with higher economic and social status leave elsewhere), and a higher share of older people (increasing a share of individuals with underlying health conditions) ( Haase et al., 2014 ; Hartt 2019 ; Hoekveld 2012 ; Krzysztofik et al., 2020 ). The shrinking cities have higher exposure to extreme socioeconomic phenomena, including financial stress due to the decreases in the city’s budget. Decreasing budget in its turn has further urban development implications since implementation of some plans deemed of lesser priority such as environmental and cultural may be delayed and cancelled altogether ( Kunzmann, 2020 ; Sharifi and Khavarian-Garmsir, 2020 ).

Tennessee is one of the US southern Sunbelt states which had infection surges since summer 2020 due to the aggressive push for economy opening by then-President Trump administration. The pandemic has affected unemployment for every state in the United States ( Falk et al., 2020 ). Fig. 3 portrays selected industries impacted by the economic recession in Tennessee using seasonally adjusted data on employees on nonfarm payrolls for November 2019 (as a base period), September–November 2020. Unemployment rates concentrate disproportionately in sectors providing in-person non-essential services where some demographic groups are overrepresented. This results in substantially higher unemployment rates for those workers ( Cortes and Forsythe, 2020 ; Fairlie, 2020 ). Accordingly, it can be seen in Fig. 3 that in Tennessee, among the reported industries, leisure and hospitality has suffered the most, followed by jobs in government, education and health services, professional and business services, and trade, transportation, utilities. There was a slight increase in jobs in financial activities from 2019 to 2020 ( Bureau of Labor Statistics (BLS), 2020a ). The hardest hit industries tend to employ demographic groups such as women, minorities, low-income workers, and younger workers who have experienced greater job losses ( Murray and Olivares, 2020 ).

Employees on nonfarm payrolls by selected industry sector, seasonally adjusted, in TN.

2. Materials and methods

In the absence of fine-scale monthly data on employment and unemployment, we sourced county-level data from the Bureau of Labor Statistics (BLS) to track monthly changes in employment and unemployment in Tennessee (retrieved from https://www.bls.gov/lau/ ). Labor force data were extracted from this official primary source.

We used a comparative assessment approach to analyze the COVID-19-based labor market outcomes including the rates of COVID-19-related employment and unemployment attributable to social disadvantage conditions. For this, we stratify data based on community disadvantage status, and combine data in a comparative assessment framework. We proceed and identify disadvantaged communities using the methodology described below. Next, we test the hypothesis that in areas with high social disadvantage where more essential workers are more likely to reside, the unemployment is higher while employment opportunities are lower by comparing unemployment and employment rates within these communities to those of more privileged communities.

3. Theory/calculation

We focus on the areas where the multiple risk factors identified in the recent literature co-locate spatially and term these places “ multi-dimensional social disadvantaged areas ”. We carried out a rigorous literature review of the variables to stand in for social disadvantage in this research. The following demographic and socio-economic factors have been selected to represent community’s vulnerability: (1) Minorities and ethnicity; (2) Crowded households; (3) Poverty; (4) Education; (5) Underlying medical conditions (obesity); and (6) Unemployment. For the 1st variable, minorities and ethnicity , we used percent minority population and Hispanic ethnicity as studies commonly use race and ethnicity as vulnerability metrics (as explained in Section 2 Background information). For the 2nd variable, crowded households , we used percent households that are multigenerational as an indicator of crowdedness, and thus, indicating area’s disadvantage with a high share of such households. For the 3rd variable, poverty , we chose percent of households below 100% of federal poverty level which is also known as the poverty line. It is an economic measure of income. The poverty guidelines are updated annually by the US Department of Health and Human Services to indicate the minimum income needed by a family for housing, food, clothing, transportation, and other basic necessities and to determine eligibility for certain welfare benefits. This measure was used because less affluent and less privileged households have fewer means and less access to various resources to cope with the effects of financial crises ( Pfeffer et al., 2013 ). Low-income households may be especially vulnerable to wage losses during the outbreak ( Qian and Fan, 2020 ). For the 4th variable, education , we used percent of population with less than high school diploma since lower educational attainment is an indicator of poverty and thus captures social disadvantage, while workers with better education have higher economic resilience when challenged with a large-scaled social shock ( Cutler et al., 2015 ; Kalleberg, 2011 ). For the 5th variable, underlying medical conditions , we used percent population with obesity as the top risk for COVID-19-related hospitalization. Supported by several lines of evidence, both domestically and internationally, obesity may predispose to more severe COVID-19 outcomes ( O’Hearn et al., 2021 ). Finally, for the 6th variable, unemployment , unemployment rate (averaged from August 2019 to January 2020 to adjust for seasonality) was used as a marker of overall vulnerability as it is linked to overall mortality. Further, regions with higher unemployment are more susceptible to business-cycle fluctuations, and thus, are more socially and economically vulnerable.

These socio-economic and demographic attributes (minority population, Hispanic ethnicity, federal poverty level, crowded households, adult obesity, lower educational attainment, and unemployment) have been used in this research to create a composite variable to represent a multi-dimensional social disadvantage (also referred to as vulnerability). Due to different variances in the original variables, we standardized them to prevent a disproportionate impact which may be caused by any one original variable with a large variance. The z-score transformation was applied by averaging the original variables and computing z scores with a mean of 0 and values ranging from negative to positive numbers ( Song et al., 2013 ).

Thus, the original variables were converted to z-scores to preserve the distribution of the raw scores and to ensure the equal contributions of the original variables. Next, we created a composite variable capturing a multi-dimensional social disadvantage. It was calculated by summing standardized z-scores of the original risk factors. The higher value can be interpreted as higher disadvantage while the lower value means more privileged communities. Based on the frequency distribution of values of the composite variable, we established a cut-off value for the composite variable to designate communities with high or low exposure to social disadvantage. We used the following method to determine the cut-off value of the composite variable. The values greater than 3.38 correspond to 1 standard deviation above the mean (or, the 88th percentile in the value distribution) indicating communities in the top 12 percent of social disadvantage and therefore, a higher share of factors contributing to disadvantage. This value was used to differentiate communities according to their disadvantage status. We identified twelve counties with high social disadvantage (N high = 12), and other counties represent more privileged communities (N low = 83). To test whether the taken approach correctly identifies disadvantaged communities, we conducted a Wilcoxon two-sample test for the variables of interest ( Table 1 ). We report the results of the estimates in the following section. The above socio-economic and demographic population characteristics come from the 2018 American Community Survey (ACS) 5-year data, an annual nationwide survey conducted by the US Census Bureau, available for various geographic units and applied for areal units within the study area ( U. S. Census Bureau, 2020 ).

Descriptive statistics.

The basic descriptive demographic and socio-economic characteristics of the TN population are shown in Table 1 . It includes the summaries for communities with high and low social disadvantage allowing to compare the variables of interest between these communities. The following variables are reported: percent African American, percent Hispanic, median income, percent of people over 25 years who are less than high school graduates, estimated percent of obese adults, percent households below 100% of federal poverty level, and percent of multi-generation households. The factors comprising social disadvantage were statistically significantly different than those extant in more privileged counties. Compared with the general TN population, the disadvantaged cohort was generally more likely to be of non-Hispanic Black race; more impoverished; with less educational attainment, more obese, and had more households with crowded conditions.

To visualize social disadvantage and show how it varies across the space, we used our sample of social disadvantage measurements and created a surface of social disadvantage within the study area using the Geographic Information System (GIS). The interpolated surface was derived from an Inverse Distance Weighted technique ( Watson and Philip, 1985 ). Fig. 4 presents the surface illustrating that both urban and rural counties in Tennessee are subject to social disadvantage.

Social disadvantage within the study area.

We examined how unemployment changed from August 2019 to December 2020. Currently, all counties have substantially higher unemployment compared with that prior to COVID. Fig. 5 presents the results of the Nonparametric One-Way ANOVA test showing the distribution of Wilcoxon scores for unemployment rate for all counties in Tennessee combined, regardless of social disadvantage status, for 17 months. A statistically significant difference is found for unemployment rates between the pre-COVID period and the period since April 2020, with current unemployment rates although decreased but still significantly higher compared with those prior to the recession.

Nonparametric One-Way ANOVA and distribution of Wilcoxon scores for unemployment rate for all counties combined for 17 months (August 2019–October 2020), regardless of social disadvantage status.

We compared employment and unemployment rates for Tennessee counties stratified by the type of social disadvantage separately for each month. Fig. 6 presents the average employment and unemployment rates by community disadvantage from August 2019 to December 2020 in a graphical form. The results of the non-parametric Wilcoxon test for employment and unemployment rates are presented in Table 2 . Pre-COVID and before the unemployment peak in April 2020, communities with high social disadvantage consistently had less jobs and greater unemployment, which we tested statistically and found a significant difference for both outcomes of the labor market between communities by their disadvantage status ( Table 2 ). Shown in Table 2 , in April and May 2020, during the peak of unemployment and immediately after, unemployment rates observed in both types of communities were high with no statistical difference. In June, the differences again became prominent, when there were more jobs available in more advantaged areas and employment rate remained consistently greater in areas with less disadvantage. Also in June, unemployment rate remained consistently greater in areas with higher disadvantage. This month saw the greater difference in both outcomes since the COVID-19 than pre-pandemic (supported by higher p-values). Compared with all TN population, residents of disadvantaged counties had less jobs available and were more likely to be unemployed during all periods except for April and May.

Mean employment and unemployment stratified by community disadvantage status.

Wilcoxon Two-Sample Test: Distribution of Wilcoxon scores in employment and unemployment rates by community disadvantage status by month (August 2019–December 2020).

We examined the percent change in both labor market outcomes. Fig. 7 presents the percent change in mean employment ( Fig. 7 a), and mean unemployment by community disadvantage ( Fig. 7 b). The percent change in employment and unemployment was relatively small in both types of community during the pre-COVID period. However, the overall fluctuations in both conditions were greater in communities with high social disadvantage (evidenced by a greater range between ups and downs for disadvantaged communities shown with the black-colored symbols). On the other hand, employment and unemployment were more stable in more privileged communities (shown with the grey-colored symbols in the Fig. 7 ). During the unemployment peak in April 2020, the change in percent employment was −11.5 points from the previous month even in more advantaged counties, while the unemployment in April increased by 10.42 percentage points in disadvantaged counties.

Percent change in (a) mean employment; (b) mean unemployment by community disadvantage.

We show how various factors of social disadvantage intersect and combined impact economic vulnerability measured by unemployment rate. Fig. 8 reports the link between unemployment and social disadvantage pre-COVID (unemployment rate was averaged over August 2019–January 2020 in Fig. 8 a), and during COVID (unemployment rate for November 2020 is shown in Fig. 8 b). During the COVID pandemic, its impact is even stronger as evidenced by a greater slope of the line of fit, larger coefficients, and a greater R-squared value ( Fig. 8 b). The strong relationship between these factors of social disadvantage and economic outcomes in COVID-19 might inform post-COVID recovery intervention strategies to reduce COVID-19-related economic vulnerability burdens. For example, in the light of findings on socio-economic and demographic subpopulations at a higher risk for economic damages, prioritization of economic relief distribution might be based on community disadvantage status targeting individuals from areas with existing inequalities to increase economic resilience of marginalized communities.

Unemployment and Social disadvantage: (a) pre-COVID (averaged August 2019–January 2020); (b) during COVID (November 2020).

5. Discussion

Current studies on the impacts of COVID-19 tend to focus on medical aspects while non-medical urban research mostly analyzes the role of environmental quality. To better understand the full effects of pandemics on communities and minimize the various impacts as well as to improved response, other aspects need to be examined. This includes studying less researched themes including socio-economic impacts consisting of both social impacts and social factors making individuals and communities less resilient and more vulnerable to the effects of the COVID. Additionally, economic impacts of the pandemic-caused recession so far remain relatively underexplored and need to be investigated ( Sharifi and Khavarian-Garmsir, 2020 ).

Communities are often severely segregated along wealth and social lines in developing and developed world ( Wilkinson et al., 2020 ). We study the role of social factors and the impact of the COVID on labor market conditions in Tennessee. Specifically, we studied the impacts of social environment on employment and unemployment through the concept of a multi-dimensional social disadvantage by using geospatial science.

A recent study identified factors which can make a community more vulnerable to the pandemic’s effects using as a case study the province of Silesia in Poland, one of the largest industrial and mining regions in Europe. Specialized functions such as mining-oriented industries, large care centers, polycentricity, and urban shrinkage make communities most at risk due to very negative impacts on urban economy ( Krzysztofik et al., 2020 ). Since vulnerability is always very context-specific, we found a combination of different causal factors of social disadvantage captured by a composite variable making communities most at risk during the COVID reflected in broader social and economic outcomes. In creating a composite variable to capture social disadvantage logically and meaningfully, the following variables were used: % African American, % Hispanic, % below 100% federal poverty level, % population with less than high school diploma (an indicator of poverty), % multi-generation households (an indicator of crowdedness), % estimated obese adults reporting to be obese with the BMI 30 or greater, % unemployed. The proposed method can be generalized beyond the study area and used as a tool by policy makers using consistent criteria for the delineation of areas carrying a greater risk for the more severe impact by the pandemic due to co-existence and co-location of the multi-dimensional social disadvantage factors which are more likely to experience further socio-economic disruptions.

Current urban research on COVID economic impacts found that some cities are more vulnerable than others and are most at risk. Cities with an undiversified economic structure with industries where a large number of workers are shoulder-to-shoulder share cramped spaces for a prolonged time and where social distancing is challenging (e.g., meat-packing and poultry processing plants), cities relying on tourism as well as cities that have large care centers, polycentric cities, and shrinking cities are the most vulnerable to negative impacts on urban economy. The urban hotel market, city tax revenues, citizens' income, tourism and hospitality, small- and medium sized firms, urban food supply chain, and migrant workers are all impacted ( Krzysztofik et al., 2020 ). Other recent studies similarly concluded that the COVID has revealed the extreme vulnerability of cities and urban areas disrupting tourism and affecting supply chains in cities ( Batty, 2020 ; Gössling et al., 2020 ). We support this statement but also find that rural areas can experience a broad range of social and economic damages related to COVID.

Before and during the COVID-19 period, money laundering, limitations of economic development, environmental pollution and uncontrolled deforestation, population displacement, institutional incompetence, and corruption of political elites have been debated including corruption and conflagration in Bucharest before the pandemic ( Creţan & O’Brien, 2020 ), as well as other contestations on selling masks and different medical products highlighted in different countries during the pandemic period. Following catalytic events, the affected community may respond to long-held concerns with demands to address these problems bringing about important changes to the systems. Marginalized stigmatized minorities may effectively overcome discriminatory laws, higher poverty and other constraints and influence public opinion and politics in their favor through collective action via various strategies including protests against corruption and the inaction of the political leaders in Romania in 2015 forcing the resignation of the Government, and protests in the US in the aftermath of police violence against black people have been documented ( Creţan & O’Brien, 2020 ; Fryer, 2019 ). During the COVID-19, the non-payment of wages and poor working and living conditions caused seasonal workers in Germany to protest against this unfair treatment, however, generating low coverage in the national press ( Mayer-Ahuja, 2020 ).

6. Conclusions

Some socio-economic and demographic conditions consistently and significantly impact some communities more often than others, particularly based on ethnic minority status, low income, and rural location. The conditions include systemic issues such as fragmented health care system (within which some individuals do not get health care in a timely fashion), racism and structural disparities in education, income, wealth, a consistent lack of economic opportunity, environmental factors, transportation and housing ( Petterson et al., 2020 ). These factors interact in complex ways resulting in persisting social environment-driven health and other inequalities which if left unaddressed will only increase.

Respectively, among policies goals across the Global North enhancing wellbeing and social mobility for disadvantaged and marginalized families, creating socially mixed, heterogeneous neighborhoods (that is, desegregation) is promoted to avoid spatial segregation based on racial and ethnic membership and class while supporting social cohesion ( Méreiné-Berki et al., 2021 ). Importantly, a marginalized community is not a homogeneous group as the lived experience of disadvantage within the communities is variegated: respectively, policies to improve socio-spatial integration and addressing the various causes of extreme poverty including social, economic, and cultural that improve social equity have been suggested since desegregation on its own is insufficient (( Méreiné-Berki et al., 2021 ). Sustainable planning may mitigate consequences of urban sprawl noted in the urban studies literature including urban blight which is the greatest in poorest areas entrapping the low-income residents in the inner city where they have only limited regional mobility and access to job opportunities at the urban edge. Understanding the links between a development of a metropolitan-wide blight remediation strategy toward a sustainable urban form and welfare enhancing among the disadvantaged populations needs to be further investigated.

During public health crises, the importance of the central role of the community has been highlighted especially when some state-based social services may be less available due to lockdown. Rather than inventing new solutions, voluntary informal social networks that have been generated by communities utilize local assets and resources ( Bear et al., 2020 ). Community-based initiatives may rely on the voluntary sector, faith- and charities-based organizations, and social enterprises for various services including help with visiting housebound people, or using them as a distribution hub for food distribution to families in need.

In conclusion, in this study, we situated the research on economic impacts of the COVID in the broader context of social disadvantage with findings both domestically and from other countries in line with those in our study. The earlier misleading view of the global epidemic representing a systematic disadvantage that may affect and limit everyone’s economic activity, with any socioeconomic status or from any geographic location, was rejected. Our finding indicates that certain factors may increase people's vulnerability to the financial stress related to COVID-19. We find support that the social distribution of economic vulnerability is magnified in regions with pre-existing social disparities, creating new forms of disparity ( Qian and Fan, 2020 ).

This work was supported by the UTHSC/UofM SARS-CoV-2/COVID-19 Research CORNET (Collaboration Research Network) Award.

CRediT authorship contribution statement

Anzhelika Antipova: Conceptualization, Formal analysis, Methodology, Visualization, Writing – original draft, Writing – review & editing.

Declaration of competing interest

The author declares no conflict of interest.

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The White House 1600 Pennsylvania Ave NW Washington, DC 20500

Remarks by President Biden on the Anniversary of the COVID- ⁠ 19 Shutdown

8:01 P.M. EST

THE PRESIDENT: Good evening, my fellow Americans.

Tonight, I’d like to talk to you about where we are as we mark one year since everything stopped because of this pandemic.

A year ago, we were hit with a virus that was met with silence and spread unchecked.

Denials for days, weeks, then months that led to more deaths, more infections, more stress, and more loneliness.

Photos and videos from 2019 feel like they were taken in another era. The last vacation. The last birthday with friends. The last holiday with the extended family.

While it was different for everyone, we all lost something.

A collective suffering. A collective sacrifice. A year filled with the loss of life — and the loss of living for all of us.

But, in the loss, we saw how much there was to gain in appreciation, respect, and gratitude.

Finding light in the darkness is a very American thing to do. In fact, it may be the most American thing we do.

And that’s what we’ve done.

We’ve seen frontline and essential workers risking their lives — sometimes losing them — to save and help others. Researchers and scientists racing for a vaccine. And so many of you, as Hemingway wrote, being strong in all the broken places.

I know it’s been hard. I truly know.

As I’ve told you before, I carry a card in my pocket with the number of Americans who have died from COVID to date. It’s on the back of my schedule. As of now, the total deaths in America: 527,726. That’s more deaths than in World War One, World War Two, the Vietnam War, and 9/11 combined.

They were husbands, wives, sons and daughters, grandparents, friends, neighbors — young and old. They leave behind loved ones unable to truly grieve or to heal, even to have a funeral.

But I’m also thinking about everyone else who lost this past year to natural causes, by cruel fate of accident, or other diseases. They, too, died alone. They, too, leave loved ones behind who are hurting badly.

You know, you’ve often heard me say before, I talk about the longest walk any parent can make is up a short flight of stairs to his child’s bedroom to say, “I’m sorry. I lost my job. We can’t be here anymore.” Like my Dad told me when he lost his job in Scranton.

So many of you have had to make that same walk this past year.

You lost your job. You closed your business. Facing eviction, homelessness, hunger, a loss of control, and, maybe worst of all, a loss of hope.

Watching a generation of children who may be set back up to a year or more — because they’ve not been in school — because of their loss of learning.

It’s the details of life that matter most, and we’ve missed those details.

The big details and small moments.

Weddings, birthdays, graduations — all the things that needed to happen but didn’t. The first date. The family reunions. The Sunday night rituals.

It’s all has exacted a terrible cost on the psyche of so many of us. For we are fundamentally a people who want to be with others — to talk, to laugh, to hug, to hold one another.

But this virus has kept us apart.

Grandparents haven’t seen their children or grandchildren. Parents haven’t seen their kids. Kids haven’t seen their friends.

The things we used to do that always filled us with joy have become the things we couldn’t do and broke our hearts.

Too often, we’ve turned against one another.

A mask — the easiest thing to do to save lives — sometimes it divides us.

States pitted against one other instead of working with each other.

Vicious hate crimes against Asian Americans, who have been attacked, harassed, blamed, and scapegoated. At this very moment, so many of them — our fellow Americans — they’re on the frontlines of this pandemic, trying to save lives, and still — still — they are forced to live in fear for their lives just walking down streets in America. It’s wrong, it’s un-American, and it must stop.

Look, we know what we need to do to beat this virus: Tell the truth. Follow the scientists and the science. Work together. Put trust and faith in our government to fulfill its most important function, which is protecting the American people — no function more important.

We need to remember the government isn’t some foreign force in a distant capital. No, it’s us. All of us. “We the People.” For you and I, that America thrives when we give our hearts, when we turn our hands to common purpose. And right now, my friends, we are doing just that. And I have to say, as your President, I am grateful to you.

Last summer, I was in Philadelphia, and I met a small-business owner — a woman. I asked her — I said, “What do you need most?” I’ll never forget what she said to me. She said — looking me in the eye, she said, “I just want the truth. The truth. Just tell me the truth.” Think of that.

My fellow Americans, you’re owed nothing less than the truth.

And for all of you asking when things will get back to normal, here is the truth: The only way to get our lives back, to get our economy back on track is to beat the virus.

You’ve been hearing me say that for — while I was running and the last 50 days I’ve been President. But this is one of the most complex operations we’ve under- — ever undertaken as a nation in a long time.

That’s why I’m using every power I have as President of the United States to put us on a war footing to get the job done. It sounds like hyperbole, but I mean it: a war footing.

And thank God we’re making some real progress now.

On my first full day in office, I outlined for you a comprehensive strategy to beat this pandemic. And we have spent every day since attempting to carry it out.

Two months ago, the country — this country didn’t have nearly enough vaccine supply to vaccinate all or near all of the American public. But soon we will.

We’ve been working with the vaccine manufacturers — Pfizer, Moderna, Johnson & Johnson — to manufacture and purchase hundreds of millions of doses of these three safe, effective vaccines. And now, at the direction and with the assistance of my administration, Johnson & Johnson is working together with a competitor, Merck, to speed up and increase the capacity to manufacture new Johnson & Johnson vaccine, which is one shot.

In fact, just yesterday, I announced — and I met with the CEOs of both companies — I announced our plan to buy an additional 100 million doses of Johnson & Johnson vaccines. These two companies — competitors — have come together for the good of the nation, and they should be applauded for it.

It’s truly a national effort, just like we saw during World War II.

Now because of all the work we’ve done, we’ll have enough vaccine supply for all adults in America by the end of May. That’s months ahead of schedule.

And we’re mobilizing thousands of vaccinators to put the vaccine in one’s arm. Calling on active duty military, FEMA, retired doctors and nurses, administrators, and those to administer the shots.

And we’ve been creating more places to get the shots. We’ve made it possible for you to get a vaccine at nearly one — any one of nearly 10,000 pharmacies across the country, just like you get your flu shot.

We’re also working with governors and mayors, in red states and blue states, to set up and support nearly 600 federally supported vaccination centers that administer hundreds of thousands of shots per day. You can drive up to a stadium or a large parking lot, get your shot, never leave your car, and drive home in less than an hour.

We’ve been sending vaccines to hundreds of community health centers all across America, located in underserved areas. And we’ve been deploying and we will deploy more mobile vehicles and pop-up clinics to meet you where you live so those who are least able to get the vaccine are able to get it.

We continue to work on making at-home testing available.

And we’ve been focused on serving people in the hardest-hit communities of this pandemic — Black, Latino, Native American, and rural communities.

So, what does all this add up to? When I took office 50 days ago, only 8 percent of Americans after months — only 8 percent of those over the age of 65 had gotten their first vaccination. Today, that number is [nearly] 65 percent. Just 14 percent of Americans over the age 75, 50 days ago, had gotten their first shot. Today, that number is well over 70 percent.

With new guidance from the Centers for Disease Control and Prevention — the CDC — that came out on Monday, it means simply this: Millions and millions of grandparents who went months without being able to hug their grandkids can now do so. And the more people who are fully vaccinated, the CD [CDC] will continue to provide guidance on what you can do in the workplace, places of worship, with friends, and as well as travel.

When I came into office, you may recall, I set a goal that many of you said was, kind of, way over the top. I said I intended to get 100 million shots in people’s arms in my first 100 days in office. Tonight, I can say we are not only going to meet that goal, we’re going to beat that goal. Because we’re actually on track to reach this goal of 100 million shots in arms on my 60th day in office. No other country in the world has done this. None.

Now I want to talk about the next steps we’re thinking about.

First, tonight, I’m announcing that I will direct all states, tribes, and territories to make all adults — people 18 and over — eligible to be vaccinated no later than May 1.

Let me say that again: All adult Americans will be eligible to get a vaccine no later than May 1. That’s much earlier than expected.

Let me be clear: That doesn’t mean everyone’s going to have that shot immediately, but it means you’ll be able to get in line beginning May 1. Every adult will be eligible to get their shot.

To do this, we’re going to go from a million shots a day that I promised in December, before I was sworn in, to maintaining — beating our current pace of two million shots a day, outpacing the rest of the world.

Secondly, at the time when every adult is eligible in May, we will launch, with our partners, new tools to make it easier for you to find the vaccine and where to get the shot, including a new website that will help you first find the place to get vaccinated and the one nearest you. No more searching day and night for an appointment for you and your loved ones.

Thirdly, with the passage of the American Rescue Plan — and I thank again the House and Senate for passing it — and my announcement last month of a plan to vaccinate teachers and school staff, including bus drivers, we can accelerate the massive, nationwide effort to reopen our schools safely and meet my goal, that I stated at the same time about 100 million shots, of opening the majority of K-8 schools in my first 100 days in office. This is going to be the number one priority of my new Secretary of Education, Miguel Cardona.

Fourth, in the coming weeks, we will issue further guidance on what you can and cannot do once fully vaccinated, to lessen the confusion, to keep people safe, and encourage more people to get vaccinated.

And finally, fifth, and maybe most importantly: I promise I will do everything in my power, I will not relent until we beat this virus, but I need you, the American people. I need you. I need every American to do their part. And that’s not hyperbole. I need you.

I need you to get vaccinated when it’s your turn and when you can find an opportunity, and to help your family and friends and neighbors get vaccinated as well.

Because here’s the point: If we do all this, if we do our part, if we do this together, by July the 4th, there’s a good chance you, your families, and friends will be able to get together in your backyard or in your neighborhood and have a cookout and a barbeque and celebrate Independence Day. That doesn’t mean large events with lots of people together, but it does mean small groups will be able to get together.

After this long hard year, that will make this Independence Day something truly special, where we not only mark our independence as a nation, but we begin to mark our independence from this virus.

But to get there, we can’t let our guard down.

This fight is far from order — from over. As I told the woman in Pennsylvania, “I will tell you the truth.”

A July 4th with your loved ones is the goal. But a goal — a lot can happen; conditions can change.

The scientists have made clear that things may get worse again as new variants of the virus spread.

And we’ve got work to do to ensure everyone has confidence in the safety and effectiveness of all three vaccines.

So my message to you is this: Listen to Dr. Fauci, one of the most distinguished and trusted voices in the world. He has assured us the vaccines are safe. They underwent rigorous scientific review. I know they’re safe. Vice President Harris and I know they’re safe. That’s why we got the vaccine publicly in front of cameras so — for the world to see, so you could see us do it. The First Lady and the Second Gentleman also got vaccinated.

Talk to your family, your friends, your neighbors — the people you know best who’ve gotten the vaccine.

We need everyone to get vaccinated. We need everyone to keep washing their hands, stay socially distanced, and keep wearing the masks as recommended by the CDC.

Because even if we devote every resource we have, beating this virus and getting back to normal depends on national unity.

And national unity isn’t just how politics and politicians vote in Washington or what the loudest voices say on cable or online. Unity is what we do together as fellow Americans. Because if we don’t stay vigilant and the conditions change, then we may have to reinstate restrictions to get back on track. And, please, we don’t want to do again.

We’ve made so much progress. This is not the time to let up. Just as we are emerging from a dark winter into a hopeful spring and summer is not the time to not stick with the rules.

I’ll close with this.

We’ve lost so much over the last year.

We’ve lost family and friends.

We’ve lost businesses and dreams we spent years building.

We’ve lost time — time with each other.

And our children have lost so much time with their friends, time with their schools. No graduation ceremonies this — this spring. No graduations from college, high school, moving-up ceremonies.

You know, and there’s something else we lost.

We lost faith in whether our government and our democracy can deliver on really hard things for the American people.

But as I stand here tonight, we’re proving once again something I have said time and time again until they’re probably tired of hearing me say it. I say it foreign leaders and domestic alike: It’s never, ever a good bet to bet against the American people. America is coming back.

The development, manufacture, and distribution of the vaccines in record time is a true miracle of science. It is one of the most extraordinary achievements any country has ever accomplished.

And we also just saw the Perseverance rover land on Mars. Stunning images of our dreams that are now a reality. Another example of the extraordinary American ingenuity, commitment, and belief in science and one another.

And today, I signed into law the American Rescue Plan, an historic piece of legislation that delivers immediate relief to millions of people. It includes $1,400 in direct rescue checks — payments. That means a typical family of four earning about $110,000 will get checks for $5,600 deposited if they have direct deposit or in a check — a Treasury check.

It extends unemployment benefits. It helps small businesses. It lowers healthcare premiums for many. It provides food and nutrition, keeps families in their homes. And it will cut child poverty in this country in half, according to the experts. And it fi- — and it funds all the steps I’ve just described to beat the virus and create millions of jobs.

In the coming weeks and months, I’ll be traveling, along with the First Lady, the Vice President, the Second Gentleman and members of my Cabinet, to speak directly to you, to tell you the truth about how the American Rescue Plan meets the moment. And if it fails at any pa-, I will acknowledge that it failed. But it will not.

About how after a long, dark years — one whole year, there is hope and light of better days ahead.

If we all do our part, this country will be vaccinated soon, our economy will be on the mend, our kids will be back in school, and we will have proven once again that this country can do anything — hard things, big things, important things.

Over a year ago, no one could’ve imagined what we were about to go through, but now we’re coming through it, and it’s a shared experience that binds us together as a nation. We are bound together by the loss and the pain of the days that have gone by. But we’re also bound together by the hope and the possibilities of the days in front of us.

My fervent prayer for our country is that, after all we have been through, we’ll come together as one people, one nation, one America.

I believe we can and we will. We’re seizing this moment. And history, I believe, will record: We faced and overcame one of the toughest and darkest periods in this nation’s history — darkest we’ve ever known.

I promise you, we’ll come out stronger with a renewed faith in ourselves, a renewed commitment to one another, to our communities, and to our country.

This is the United States of America, and there is nothing — nothing — from the bottom of my heart, I believe this — there is nothing we can’t do when we do it together.

So God bless you all.

And please, God, give solace to all those people who lost someone.

And may God protect our troops.

Thank you for taking the time to listen.

I look forward to seeing you.

8:27 P.M. EST

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California sees highest unemployment rates in the country

C alifornia now has the highest unemployment rate in the country , reaching 5.3%, according to data from the Employment Development Department .

At the beginning of the COVID-19 pandemic, California lost 2.7 million jobs due to stay-at-home orders. Since then, California has rebounded by adding 3 million jobs to its market, averaging roughly 66,000 jobs per month.

However, a recent data analysis found a discrepancy between the numbers. While federal data showed the state created 300,000 jobs between September 2022 and September 2023, the corrected amount revealed that only 50,000 jobs were created during that period.

“I think California’s economy is the leading edge of the national economic slowdown,” said Sung Won Sohn, a professor of finance and economics at Loyola Marymount University.

It can be challenging to measure job growth accurately. The number is based on a monthly survey of workers. Initial numbers showed the state added 9,900 jobs in July 2023, but corrected numbers found the state actually lost 41,400 jobs that same month.

The tech industry’s boom during the pandemic era may also be reaching a turning point, affecting Silicon Valley. After receiving billions of dollars in federal aid and a “runaway stock market,” technology companies may have hired too many too quickly.

“The tech sector, especially major firms, over-hired in the first post-pandemic year, and has been shedding jobs since,” said Michael Bernick, a former director of the California Employment Development Department. “The (San Francisco) Bay Area is the new epicenter of Artificial Intelligence start-ups. But these start-ups so far are creating a small number of jobs.”

The SAG-AFTRA strike , which lasted nearly five months in 2023, also displaced some of California’s economy. Nearly 25,000 actors and writers lost their jobs during this time.

According to Kevin Klowden, an executive director at the Milken Institute, Hollywood will take years to return to where it was before the strike. He said some restaurants and other businesses that relied on actors and writers for business may never reopen.

CLICK HERE TO READ MORE FROM THE WASHINGTON EXAMINER

In total, there were 1,027,000 Californians without jobs in February, up 13,100 from January and 165,400 more than in February 2023.

Of the state’s 11 industry sectors, private education and health services saw the most significant increase in job growth, adding 15,400 jobs to the state’s economy. The construction industry saw a loss of 9,600 jobs.

California sees highest unemployment rates in the country

Nigeria’s dichotomy: low unemployment, high poverty rates

Jonathan lain.

When analyzing poverty, only looking at unemployment rates will be insufficient and misleading. Instead, job quality – underemployment, people’s specific activities and occupations, and markers of formality – is fundamental for understanding the labor market and providing recommendations for policies.

In the case of a country like Nigeria, unemployment has proved a difficult statistic to interpret. Nigeria’s unemployment rate stood at 33.3 percent in Q4 of 2020. However, the National Bureau of Statistics (NBS) recently reported unemployment rates of 5.3 percent (Q4 2022) and 4.1 percent (Q1 2023), based on the new Nigeria Labour Force Survey (NLFS).

How can this make sense?

To begin, the definition of unemployment has changed to bring it more in line with the standards of the International Labour Organization (ILO). For the new NLFS, the “employed” covers anyone who worked one hour or more for pay or profit in the last seven days, even if they were temporarily absent. The “unemployed” are those individuals who are not employed but are (1) actively searching for paid work and (2) available to start paid work, either last week or within the next two weeks.

In Nigeria’s previous Unemployment Reports , the headline unemployment rate – like the 33.3 percent in Q4 2020 – included not only those who were not employed (and were searching and available) but also those working 1-19 hours per week. Thus, this headline number mixed unemployment and some proxy of time-based underemployment – although alongside this, NBS always reported unemployment according to the “international” definition as well. Additionally, temporary absences were not explicitly considered before, so the new approach correctly expands the count of employed people.

Another change in the definition moves subsistence agricultural workers from being counted as “employed” to being out of the labor force, as they produce goods for households rather than for the market. This way, they are treated in the same way as household members providing services for their household, like childcare, water fetching, cooking and so on. On top of these definitional and questionnaire changes, the new NLFS has made crucial improvements to sampling, fieldwork management, and data quality monitoring – this includes limiting the bias brought about by “proxy response”, whereby one household member responds to the questionnaire on behalf of another.

Equipped with these improvements, the new unemployment rate can be interpreted more clearly, as it avoids lumping together different concepts including unemployment, time-based under-employment, and a notion of sufficient livelihoods. It also allows international comparison. For example, Nigeria’s unemployment rate is of the same magnitude as in all of Western and Central Africa, where it stood at 4.7 percent in 2022.

Unemployment in Nigeria and in Western and Central Africa

Note: NLFS standard errors clustered by enumeration area and adjusted for state-level stratification of the sample. Source: NLFS, World Development Indicators, and NBS calculations.

The unemployment rate is also consistent with the situation pre-COVID. We built a bridge to previous data by harmonizing the working age, the treatment of temporary absences, and the treatment of subsistence agriculture, as well as applying the ILO definition of unemployment.

Before 2018, unemployment rates (using the “international” methodology) were always single digit, in line with the current estimates. It was only during the COVID-19 period that unemployment spiked in Nigeria.

Unemployment rate estimates for Nigeria, 2014-2023

Note: New international definition of unemployment classes those who are not working/employed even for one hour but who are searching and available as unemployed. Estimates from COVID-19 period shown in lighter shade. Source: NBS Unemployment Reports, 2018/19 NLSS, NLFS, and World Bank estimates.

But how meaningful is a single-digit unemployment rate in a country where around a third of the population lives in poverty? The unemployment rate is certainly helpful in understanding seasonal fluctuations and short-term shocks. Yet there is no guarantee that it is correlated with poverty – the most direct measure of whether people have sufficient livelihoods.

In fact, many poor countries have very low unemployment. And within Nigeria, poor and non-poor Nigerians were about equally likely to work in 2018/19. Unemployment was, if anything, higher among richer households.

Poverty and unemployment in Nigeria’s neighbors and other comparator countries

Note: Poverty rate calculated using the latest available data and the 2.15 USD 2017 PPP per person per day international poverty line. Unemployment rates shown are the ILO modeled estimates. Source: Poverty and Inequality Platform, ILOSTAT, and World Bank estimates.

How can poverty and unemployment move in different directions? When prices increase but wages remain low, households – and especially the poorest among them – have to find any means to increase household income. They will find some work to do, for example, through small-scale agriculture, petty trading, or basic services – even if this work has very low productivity.

At the same time, richer households can afford to remain unemployed for longer while searching for a better job. Most Nigerians cannot afford to spend long spells out of employment searching for jobs, especially given the sparse coverage of social protection . Without such support, “if you do not work, you cannot eat”, and unemployment can stay low, even when poverty is widespread.

Therefore, to understand the structural health of an economy and its labor market, we need to be more nuanced with the help of additional indicators. Poverty and wellbeing are determined much more by what you do rather than whether you are employed. For example, wage jobs – being employed and paid by someone else – are better at keeping workers out of poverty. Such jobs, however, are rare in Nigeria: just 11.8 percent of employed Nigerians were primarily engaged in wage jobs in Q1 2023.

Some employed Nigerians are “underemployed”, meaning that they work less than 40 hours per week but declare themselves willing and available to work more. About 12.2 percent of employed Nigerians were underemployed in Q1 2023. Some Nigerians even search on the job, reflecting dissatisfaction with their current job or earnings. Around 7.2 percent of working-age Nigerians were employed, but searching for additional work in Q1 2023.

Policymakers should therefore not focus indiscriminately on creating any kind of job. This is the risk of blindly focusing on unemployment. The economy needs to generate productive jobs and meaningful work that can sustain households and lift them out of poverty.

The NLFS collects a host of indicators on job quality that will provide vital insights into monitoring progress towards generating the types of jobs Nigeria needs to reduce poverty. By fully harnessing its rich, high-quality data – and not just looking at unemployment – the NLFS has the potential to provide vital policy guidance for many years to come.

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Unemployment Speech

Long and Short Speeches on Unemployment

Any individual who is deprived of earning a living and faces difficulty in getting a paid job is known as unemployed and the condition is termed as unemployment. With India being a highly populated country, unemployment has always been a major problem in our country. And this problem has been increasing at a major rate.

Here, we have provided a long speech as well as a short unemployment speech in English for the students of all categories. Students can easily refer to our speech on unemployment for any exam preparation and can also gather information on this topic to prepare their own speech.

There is also a 10 Lines Speech provided by us especially for the students of Class 1 and Class 2.

Long Speech on Unemployment

This long speech on unemployment has been provided as a reference for the students of Class 7 To Class 12 for their exam preparation.

Warm greetings to everyone! I firstly appreciate everyone who has gathered here to discuss the problem of unemployment. I am thankful enough for providing me with an opportunity to deliver a speech on unemployment.

Unemployment has become a major concern among the people of India today. With the increasing population, the job sectors fail to provide a full-time job to all the people. This, as a result, has increased the rate of unemployment in our country. Thus, unemployment can be defined as the condition where an individual is deprived of a paid job or self-employment and is unable to find a suitable job for employment.

The fear of unemployment has caused a level of depression and mental stress on the youth today. In spite of getting a degree and having the highest qualifications, they still have to go through the process of unemployment. Many individuals, being the sole bread earner of the family, struggle day and night to earn a living. Unemployment not only refers to being jobless, but it also refers to the state where an individual is being underpaid as per their experience and qualifications. Several individuals are unsatisfied with the jobs they are in and are sticking to their jobs due to unemployment problems.

Implementation of various government programs to improve the practical skills of the students must be done in every school and college. Although the government of India has introduced several employment schemes to offer jobs to the unemployed, many more steps must be taken to reduce the unemployment rate in our country. People must be made aware of self-employment and proper fundings for these government programs and projects must be implemented by the government.

Lastly, I would like to thank all of you for your patience and for coming here to discuss this issue.

Short Speech on Unemployment in English

Given below is a short unemployment speech in English for the students of Class 3 to Class 6.

Greetings everyone! Today I am here to deliver a speech on the topic of unemployment.

With the fast-growing industries and economic system, our country India still lags behind in the field of employment. In spite of having a higher degree and qualification, many people have to suffer through the process of unemployment. The main reason behind this major issue is the growing population and demand for a full-time job. Many citizens of the country are still deprived of paid jobs and are struggling to earn a living. This has also eventually led to mental pressures and depression among the youth. Although there has been an increase in the literacy rate of the people that has also increased the demand for new jobs.

It is high time that the government should take up initiatives to provide employment to the people. There are several government programs and schemes that have been introduced by the Prime Minister to help the unemployed to get a paid job. New training programs should be introduced in schools and colleges for the better development of the students. People should be made familiar with the self-employment scheme and initiatives must be implemented by the government for funding these programs.

Lastly, I would like to end my speech by saying that unemployment has become a major problem in India today and necessary steps must be taken to reduce the unemployment rate.

10 Lines Speech on Unemployment

Here is a 2-minute long speech on unemployment for the students of Class 1 and Class 2.

Good morning everyone! Today I am here to deliver a speech on unemployment.

Unemployment is a serious problem faced by many people in our country.

The increasing population and higher demands for jobs give rise to unemployment.

India being a populated country faces a higher unemployment rate due to limited job sectors.

There are several people who do not have a paid job and are surviving unemployment.

Unemployment also counts those individuals who are being underpaid in their jobs and are working outside their area of interest.

Even people having higher degrees and qualifications have to go through the process of unemployment.

This causes a high level of mental pressure and depression to the individuals as they struggle day and night to earn a living.

Due to slow economic growth and small job sectors, this problem has given rise to many unemployed people.

Lastly, I would like to say that unemployment is becoming a major concern of the youth of our country and if not solved in time, it will also bring down the economic rate of our country.

FAQs on Unemployment Speech

1. How can you include initiatives taken by the government to curb unemployment in your speech?

This problem is taken very seriously by the government, and a number of schemes are being implemented to reduce unemployment. Among these schemes are IRDP (Integrated Rural Development Programme), DPAP (Drought Prone Area Programme), Jawahar Rozgar Yojana, Training for self-employment, PMIUPEP (Prime Minister's Integrated Urban Poverty Eradication Program), employment exchange, Employment Guarantee Scheme, development of organized sector, small and cottage industries, employment in forging countries, and others.

2. What are the reasons for unemployment that I can include in my unemployment speech?

There are numerous reasons for a large section of the population of our country to be facing the problem of unemployment. Some of these reasons are population growth, slow economic growth, seasonal occupations, slow economic growth and a decrease in the cost of living in our country. Additionally, the large population of the country adds to the unemployment problem in India. The country's population demands a huge number of jobs and occupations every year, which the government is unable to supply.

3. What are the types of unemployment?

All of us today are aware of what unemployment is. However, it does not just mean that any person is unemployed. Likewise, unemployment also refers to people working in areas that are outside of their expertise or mastery. Some of the various types of unemployment include disguised unemployment, seasonal unemployment, open unemployment, technological unemployment, and structural unemployment. Other types of unemployment include cyclical unemployment, educated but unemployed, underemployment, frictional unemployment, chronic unemployment and casual unemployment. Presently, in India, among the most prevalent types of unemployment are seasonal unemployment, underemployment, and disguised unemployment.

4. What type of unemployment can be found in developed countries?

Mostly in developed countries, cyclical and frictional unemployment exist. The period of cyclical unemployment is the period in which the unemployment rate rises and falls according to cycles of economic ups and downs. It is vital to minimize cyclical unemployment during recessions. In an economy, frictional unemployment arises from voluntary job transitions. Frictional unemployment is a fact of life, even in a growing, stable economy. The frictional unemployment that occurs when workers leave their current jobs in search of new jobs and when workers enter the workforce for the first time does not include those workers who remain in their current job until they find a new one, since they are never unemployed.

5. How to define different types of unemployment in india?

Open or Structural Unemployment- The phenomenon of open or structural unemployment occurs when a number of people desire to work but are unable to find jobs for themselves. It is a result of a growing population and people migrating to larger cities.

Disguised Unemployment - Under this type of unemployment, people seem employed, yet their productivity is zero and they do not receive any assistance to increase their output.

Seasonal Unemployment - During some seasons in India, farming is not practiced year-round, which results in farmers being jobless for a few months. Seasonal unemployment is also observed in the sugarcane industry, cold drinks industry, and crackers industry.

IMAGES

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