Tight US Labor Market and Covid Deaths

[REWahoo]

The Missing Workers Who Are Never Coming Back

Federal Reserve chair Jerome Powell struck a particularly somber note at his press conference earlier this week when he mentioned that one reason the labor market is so tight right now is that many workers died from COVID-19.

The big picture: Economists have theorized for a while about the impact of COVID deaths on the labor market. Now, research has started to emerge and key public figures like Powell are starting to talk about it explicitly.

 

[NW-Bound]

Yes.

I remember Powell said we are missing 3.5 million workers. Out of these, he said 3 million retired early. Half a million died of COVID.

Darn, I still have some short-term memory left. Amazing!

 

[audreyh1]

Yes, I remember Powell’s remarks. Thanks for the info.

 

[Out of Steam]

The first article also mentions fewer immigrants to the US as being a factor, presumably because of delays in visa processing, etc. While legal immigrants are probably a minority of those entering the US, they are the ones who can enter the workforce quickly, especially in fields requiring education.

 

[Montecfo]

People leaving the workforce is more of a puzzle than suggested here. Young people are participating in the labor force at far lower rates than pre-pandemic.

Those folks did not retire.

On the other hand, the older cohort participated at higher than trend post the financial crisis, as retirement plans had to be deferred. Covid just became a good jumping off point for some delayed retirees, although some people no doubt were dislocated or retired early.

Covid deaths are a factor in the still reduced workforce, but there is much more to discover it seems.

 

[karen1972]

My personal experience showed multiple impacts to the labor force. I know people in each of these categories.
1. Those that were working that passed away.
2. Those that were working that suffer from Long haul so now are either working part time or not at all.
3. Those not counted in the labor force but use to be a caregiver and now has to be replaced with someone that was working. Lots of friends went part time as parents no longer babysit due to risk of COVID.
4. Those that left the labor force early and won't be returning.
5. Teenagers who were impacted in school and thus their education plans changed delaying them entering the workforce.

 

[Gearhead Jim]

On average, the people who died from Covid tended to be older, less healthy, and either closer to retirement and/or less productive due to health; than others. When they died, they stopped being consumers who needed workers to make things for them.
A human tragedy, but a tiny blip in the economy.

The bigger issue is all those who are alive and healthy but partly or completely out of the labor force.

 

[foxfirev5]

Don't forget the underground cash economy. While I don't have hard facts, I've seen quite an increase in groups in old pickups doing yard work, home repairs, trash pick up, etc. Still getting govt assistance in the form of healthcare, food stamps and even unemployment or disability in some cases. It amazes me what people will tell you if you just listen. Mere observations from my daily 3 mile walk. Of course my appearance helps me fly under the radar. Old Dickies khaki work clothes with matching boots. Also, I have been offered a chance to pick up a few bucks by some of the rich cheapskates.

 

[jim584672]

If you look at the CDC death numbers most deaths are for 65 and older, so not that many are in the work force. 18-64 deaths 267,424 | >=65 deaths 810,546

https://www.cdc.gov/nchs/nvss/vsrr/covid_weekly/index.htm

 

[marko]

People leaving the workforce is more of a puzzle than suggested here. Young people are participating in the labor force at far lower rates than pre-pandemic.

Those folks did not retire.

On the other hand, the older cohort participated at higher than trend post the financial crisis, as retirement plans had to be deferred. Covid just became a good jumping off point for some delayed retirees, although some people no doubt were dislocated or retired early.

Covid deaths are a factor in the still reduced workforce, but there is much more to discover it seems.

I wonder if Covid gave a lot of people a glimpse into a better way of life beyond the 9 to 5. Being at home, not sitting in traffic for two hours a day may have lit a spark for many.

Maybe there's been some sort of downshift where a lot of people just decided to aspire for less and instead opt for part time work, more bartering and such in order to realize a work-life balance that makes more sense.

We know a few young couples with children who just decided to get off the treadmill, leave the US and focus on their family instead of striving for the six bedroom house.

Covid may have just confirmed their suspicions.

 

[Sunset]

Then there is the marginal worker, who for lack of work soft skills barely could hold a job in the past.
Once covid provided some downtime, those folks may not be able to get up the motivation to work anymore... why bother

 

[USGrant1962]

If you look at the CDC death numbers most deaths are for 65 and older, so not that many are in the work force. 18-64 deaths 267,424 | >=65 deaths 810,546

https://www.cdc.gov/nchs/nvss/vsrr/covid_weekly/index.htm

Yea, the half-million number seems exaggerated. Considering the ~75% of Covid deaths were 65+ and the normal workforce participation rate is ~65% the missing worker number would be about half that. DC math, I guess.

 

[Koolau]

The first article also mentions fewer immigrants to the US as being a factor, presumably because of delays in visa processing, etc. While legal immigrants are probably a minority of those entering the US, they are the ones who can enter the workforce quickly, especially in fields requiring education.

Probably?

On the topic of losing a lot of people to Covid, certainly half a million "w*rkers" is a lot of people, but not a very large percentage of the w*rk force. I also would question that number since Covid deaths were primarily among the aged and inform. No expert, so YMMV.

 

[Eladio]

Many healthcare workers are still out of the workforce due to vax mandates by CMS.

 

[GenXguy]

I had read 2 to 4 million equivalent full time workers were out of the workforce due to "Long COVID", so it's not just about those who died from it.

 

[GenXguy]

I wonder if Covid gave a lot of people a glimpse into a better way of life beyond the 9 to 5. Being at home, not sitting in traffic for two hours a day may have lit a spark for many.

I've never been stuck in traffic for two hours, ever, that I can recall. But there are plenty of other reasons to want to retire.

 

[RobbieB]

I was regularly on the road for more than 2 hours a day. More like 3-4 hours.

My heart bleeds for those poor abused 2 hour a day folks...

 

[audreyh1]

I was regularly on the road for more than 2 hours a day. More like 3-4 hours.

My heart bleeds for those poor abused 2 hour a day folks...

You must have been in sales?

 

[HarveyS]

The last 14 years of my career I had a 2hr commute. One hour each way. Office job.

 

[Koolau]

The last 14 years of my career I had a 2hr commute. One hour each way. Office job.

I remember whining to a a cow*rker that it had taken me 25 minutes (instead of the usual 15) to make the 5 mile trip home after w*rk on a Friday evening. He just about lost it. He explained that when he had w*rked in the Boston area, his usual commute was nearly 2 hours - each way.

The "rest of the story:" A year later, the guy went BACK to Boston to w*rk!