- 9.8 million fewer Americans were in work at the end of November compared to February.
- The leisure and hospitality industry has been the worst affected.
- Unemployment rose faster, and is falling more slowly, among Black and Latino communities.
- There are encouraging signs of recovery as 245,000 jobs were created in November.
The human cost to the US of the COVID-19 pandemic has been staggering. In just 10 months, the virus has claimed the lives of more than 300,000 Americans, and destroyed the livelihoods of many millions more.
The latest analysis by the US Bureau of Labor Statistics shows how severe the damage has been to the job market. At the end of November, there were 9.8 million fewer people in paid employment than in February (excluding farm work, which follows seasonal patterns). But, as can be seen in the chart below, some sectors of the economy have suffered far worse than others.
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Change in non-farm payroll employment by industry since February 2020
By far the worst affected has been the leisure and hospitality industry. Travel restrictions and the closure of bars and restaurants have contributed to a loss of 3.4 million jobs - from waiters, kitchen staff and hotel workers to employees at gyms, theme parks and bowling alleys.
Other industries hit particularly hard are professional and business services, education and health services, and government payrolls, which have each lost more than a million jobs since the start of the crisis. 600,000 manufacturing jobs have vanished, as factories grappled with supply chain disruptions and dramatic falls in demand.
What is the World Economic Forum doing to help the manufacturing industry rebound from COVID-19?
The COVID-19 global pandemic continues to disrupt manufacturing and supply chains, with severe consequences for society, businesses, consumers and the global economy.
As the effects of coronavirus unfold, companies are asking what short-term actions they need to take to ensure business continuity and protect their employees. How should they be preparing for the rebound and increasing their manufacturing and supply systems’ resilience?
The World Economic Forum, in collaboration with Kearney, brought together senior-level executives from various industry sectors to identify the best response to the COVID-19 crisis. Their recommendations have been published in a new white paper: How to rebound stronger from COVID-19: Resilience in manufacturing and supply systems.
Read the full white paper, and more information in our Impact Story.
Companies are invited to join the Forum’s Platform for Shaping the Future of Advanced Manufacturing and Production. Through the Platform’s work, companies can join with other leaders to help find solutions that support the reconfiguration of global value chains post-COVID-19.
In contrast, some sectors have weathered the pandemic relatively well. Financial activities, mining and logging have seen much less severe contractions and utilities have shed the fewest jobs among the industries surveyed.
Crisis exacerbates inequality
A wide range of economic indicators demonstrate that the crisis has made existing inequalities worse, with a greater impact on young people, the low-paid, women (particularly mothers of school-age children) and ethnic minorities.
As the chart below shows, unemployment rose more quickly among Black or African-American workers than white workers, and even more dramatically among those identifying as Hispanic or Latino, peaking at nearly 19% in April.
Although unemployment is now falling again as the economy begins to recover, white workers are being rehired at a faster rate than other ethnicities. The unemployment rate for Black or African American workers was 10.3% in November, 4.5 percentage points higher than in February. In comparison, the difference between unemployment rates for white workers was just 2.8 percentage points.
The leisure and hospitality sector, which has suffered the biggest job losses, is also the lowest paid, as the chart below shows.
With average weekly wages of under $500, workers in the leisure and hospitality industry are much less likely to have the savings to absorb the financial shock of unemployment. Those in the retail sector and education and health services have found themselves in only a marginally less precarious position.
Bouncing back?
November may have seen rising COVID-19 cases, but it also saw encouraging signs of economic recovery, at least in some sectors. Overall, 245,000 jobs were added over the course of November.
Change in non-farm payroll employment by industry since October 2020
Transportation and warehousing saw by far the biggest boost in employment, partly as a result of Thanksgiving sales and stocking up ahead of Christmas. However, taken alongside the accompanying fall in retail employment, it is also likely that the COVID-19 pandemic has accelerated the existing global trend towards online shopping and deliveries, at the expense of traditional stores.
What is the World Economic Forum doing about the Fourth Industrial Revolution?
The World Economic Forum was the first to draw the world’s attention to the Fourth Industrial Revolution, the current period of unprecedented change driven by rapid technological advances. Policies, norms and regulations have not been able to keep up with the pace of innovation, creating a growing need to fill this gap.
The Forum established the Centre for the Fourth Industrial Revolution Network in 2017 to ensure that new and emerging technologies will help—not harm—humanity in the future. Headquartered in San Francisco, the network launched centres in China, India and Japan in 2018 and is rapidly establishing locally-run Affiliate Centres in many countries around the world.
The global network is working closely with partners from government, business, academia and civil society to co-design and pilot agile frameworks for governing new and emerging technologies, including artificial intelligence (AI), autonomous vehicles, blockchain, data policy, digital trade, drones, internet of things (IoT), precision medicine and environmental innovations.
Learn more about the groundbreaking work that the Centre for the Fourth Industrial Revolution Network is doing to prepare us for the future.
Want to help us shape the Fourth Industrial Revolution? Contact us to find out how you can become a member or partner.
As economies around the world recover from the economic crisis triggered by COVID-19, it is likely that many of the jobs that have disappeared will not come back. For those who are out of work - and particularly the millions who are experiencing the financial and emotional distress of long-term unemployment - it is essential that opportunities are provided to develop the skills that will be needed for the jobs of the future.
And even before the pandemic, income and wealth inequality was higher in the US than in most other developed countries.
