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February 25, 2021

Economic crises

Opinion

February 25, 2021

Economic crises shine a spotlight on a society’s inequities and hierarchies, as well as its commitment to support those who are most vulnerable in such grievous moments. The calamity created by Covid-19 is no exception. The economic fallout from that pandemic has tested the nation’s social safety net as never before.

Between February and May 2020, the number of unemployed workers soared more than threefold – from 6.2 million to 20.5 million. The jobless rate spiked in a similar fashion from 3.8 percent to 13 percent. In late March, weekly unemployment claims reached 6.9 million, obliterating the previous record of 695,000, set in October 1982. Within three months, the pandemic-produced slump proved far worse than the three-year Great Recession of 2007-2009.

Things have since improved. The Bureau of Labor Statistics (BLS) announced in December that unemployment had fallen to 6.7 percent. Yet, that same month, weekly unemployment filings still reached a staggering 853,000 and though they fell to just under 800,000 last month, even that far surpassed the 1982 number.

And keep in mind that grim statistics like these can actually obscure, rather than illuminate, the depths of our current misery. After all, they exclude the 6.2 million Americans whose work hours had been slashed in December or the 7.3 million who had simply stopped looking for jobs because they were demoralized, feared being infected by the virus, had schoolchildren at home, or some of the above and more. The BLS’s rationale for not counting them is that they are no longer part of what it terms the “active labor force.” If they had been included, that jobless rate would have spiraled to nearly 24 percent in April and 11.6 percent in December.

To see just how unevenly the economic pain has been distributed in America, however, you have to dig far deeper. A recent analysis by the St Louis Federal Reserve did just that by dividing workers into five separate quintiles based on their range of incomes and the occupations typically associated with each.

The first and lowest-paid group, including janitors, cooks, and housecleaners, made less than $35,000 annually; the second (construction workers, security guards, and clerks, among others) earned $35,000-$48,000; the third (including primary- and middle-school teachers, as well as retail and postal workers), $48,000-$60,000; the fourth (including nurses, paralegals, and computer technicians), $60,000-$83,000; while employees in the highest-paid quintile like doctors, lawyers, and financial managers earned a minimum of $84,000.

More than 33 percent of those in the lowest paid group lost their jobs during the pandemic, and a similar proportion were forced to work fewer hours.

Excerpted: ‘How This Country Fails Its Most Vulnerable’

Commondreams.org