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November 10, 2022

COVID’s Continued Hit on America’s Workforce

Exploring the mystery of America’s “missing workers” two and a half years later.

While the overwhelming majority of Americans who have been sickened by COVID have recovered, the American economy has yet to fully recover from the pandemic. The current employment number is still roughly one million workers shy of pre-pandemic levels, and that’s two and a half years after the novel virus hit. The question is why, since the pandemic has ended. Although people are still coming down with COVID infections, the hospitalization rate and mortality rate have declined significantly — now producing numbers comparable to the annual flu.

So, what explains the lingering slump in the American workforce? The number of working-age Americans who died from COVID was approximately 300,000, a number that doesn’t explain the million-plus loss in workforce.

Recent research conducted by two economists, Gopi Shah Goda of Stanford University and Evan J. Soltas of the Massachusetts Institute of Technology, found that despite the fact that COVID deaths don’t explain the loss in the number of workers, the virus has still sickened many workers for longer periods of time than prior to the pandemic. This led to losses in productivity as well as wages.

In an average month this year, roughly 630,000 more workers have missed at least a week of work due to COVID-related issues than missed a week due to illness in the years prior to the pandemic. This represents a 0.4% reduction in workforce efficiency over pre-pandemic numbers. The lack of work efficiency has a domino effect down the chain, slowing work flow.

When a worker or a worker’s child is sickened by COVID, this often results in days off and lost productivity. In some instances, the loss of work hours prompted some workers to change jobs or to become self-employed. The self-employment decision has been made by a significant number of workers who either wanted to avoid COVID-related mandates or who wanted to avoid a situation where they couldn’t set their own work schedules and more easily take on dynamic situations with children getting sick.

Then there are those suffering from what has been termed “long COVID,” where months after getting infected they find themselves still suffering from various debilitating symptoms. A recent Centers for Disease Control and Prevention study found that approximately 7.5% of the adult population is suffering from long COVID. This produces a negative impact on work efficiency as well as employment numbers.

Finally, there are those who have simply taken advantage of the COVID-related relief programs, electing not to return to the workforce because there are other ways to pay for groceries, even after some of those programs were reduced or ended.

All these factors are contributing to the seemingly stagnate employment number. Furthermore, it doesn’t look like things will be changing anytime soon, despite the fact that the pandemic is over.

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