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For the Economy, the Present Doesn’t Matter. It’s All About the Near Future.

  • March 06, 2021

Will many of these jobs come back, if schools are able to operate at full capacity by the fall? The Biden pandemic rescue plan before the Senate includes $130 billion to help schools reopen safely, and an additional $350 billion to support state and local government budgets more broadly. If that money proves adequate to the task, the February job cuts could turn out to be a temporary blip.

Huge job gains were reported in February in some of the sectors most directly affected by the pandemic, specifically an increase of 355,000 in leisure and hospitality jobs, most of it tied to restaurant employment.

That’s good news as far as it goes, but restaurant employment is still 16 percent below its levels of last February, a two-million-job hole. Widespread vaccination that enables people to return to restaurants safely is the only way those jobs will come back.

The news this week that Merck will help manufacture the Johnson Johnson coronavirus vaccine is a bigger deal for out-of-work waiters and line cooks than the 286,000 bar and restaurant jobs added in February.

Things remain murky on the longer-term implications of the crisis. The surge in employment in February was entirely driven by people no longer being on temporary layoff — the number of these temporarily unemployed workers fell by 517,000 people. The number of permanent job losers remained steady at astronomical levels — 2.2 million higher than a year ago.

That raises questions about which jobs destroyed during the pandemic will come back. Are there certain patterns of behavior and business models that are gone forever? And what will the people who once worked in those businesses do now?

That’s the hardest question about the future. It is easy to describe the pathway back for jobs at schools and restaurants. But true economic health will mean that those 2.2 million people find their way back into the ranks of the employed as well, and that could take more than just a shot in the arm.

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