By now, it should come as no surprise that the hiring market isn’t what it was at the beginning of 2020. Whatever predictions were made at the end of 2019 have gone right out the window, and now, employers are bracing for the impact of the coronavirus (COVID-19).
We had initially stopped reporting on the U.S. Bureau of Labor Statistics’ (BLS) monthly jobs report, as it started to get a little redundant each month. But given the current circumstances surrounding the COVID-19 pandemic and the unusually high unemployment numbers that come with it, it’s worth revisiting this topic.
How Bad Is It?
According to the BLS, 701,000 nonfarm jobs were lost in March, and the unemployment rate rose to 4.4%. “The changes in these measures reflect the effects of the coronavirus (COVID-19) and efforts to contain it,” the BLS says. “Employment in leisure and hospitality fell by 459,000, mainly in food services and drinking places. Notable declines also occurred in health care and social assistance, professional and business services, retail trade, and construction.”
Additionally, payroll services provider ADP also reports that the private sector had a total of 27,000 job losses in March, and small businesses suffered the most, with 90,000 jobs lost. It’s worth noting that both the BLS report and ADP’s report don’t account for the entire month of March, so we can expect those numbers to be much higher when the April report is released.
According to career site Monster.com, “The mid-month reference point that the BLS uses to calculate the monthly jobs report fell just before many states enacted nonessential business closings and stay-at-home orders. When it comes to calculating job gains and losses, the BLS uses whatever week includes the 12th day of the month as a reference point. For March’s report, that was the week of Sunday, March 8 through Saturday, March 14.”
Keep in mind, this data was pulled in March. As of April 16, 2020, the unemployment numbers have drastically changed. According to MarketWatch, coronavirus-related job losses are set to top 20 million in April.
Who Is Impacted?
Going back to the March job report, however, the BLS says that the leisure and hospitality industry seems to be the hardest hit, with 459,000 jobs lost, and restaurants and bars are seeing the worst job losses (-417,000) due to many states mandating people to stay at home and shutting down nonessential businesses. According to Monster, this employment decline nearly offset the gains that were made over the past 2 years in the industry.
Given the pandemic, you would assume healthcare hiring would be at its peak, but employment in the healthcare industry actually fell by 61,000 jobs. However, we think this number will increase as more healthcare workers become sick and the industry scrambles to replace these essential workers.
It is worth noting that when these job losses are broken down more in depth, it’s primary care and specialty doctors that are seeing the most losses (-43,000), and it’s primarily in dentist offices (-17,000), physician offices (-12,000), and offices of other types of healthcare practitioners (-7,000).
And with most businesses being suspended, it should come as no surprise that the retail industry is also seeing losses, with 46,000 jobs lost in March. However, this was primarily in clothing and accessories stores (-16,000); furniture stores (-10,000); and sporting goods, hobby, book, and music stores (-9,000).
Because some retailers are considered “essential,” general merchandise stores actually experienced gains of 10,000 jobs. Monster reports that it noticed the number of people searching for grocery-related jobs increased during the last week of March. Monster also says it’s seen an increase in searches for delivery, customer service, and work-from-home jobs.
How Much Worse Is It Going to Get?
As Monster indicates, the worst is yet to come. “According to the Wall Street Journal, forecasting firm Oxford Economics projects that by May, the U.S. will have lost 27.9 million jobs and have a 16% unemployment rate. This would erase all the jobs gained since 2010 during the record-setting 113-month stretch of employment gains through February.”
And while wages did rise in March, increasing by 11 cents, it is expected that wages will go into decline in April as employers cut salaries and hours to control costs. Read more here…
Source: HR Daily Advisor