08 May Virus impact may extend to 57 million U.S. jobs

Virus impact may extend to 57 million U.S. jobs

While the coronavirus pandemic has impacted many businesses such as restaurants, retail stores, and entertainment stops, it’s continuously hurting more business as the virus spread. Read this blog post to learn more.

The coronavirus pandemic will hurt 57 million U.S. workers, more than double the number of jobless claims so far, once furloughs and reduced hours and pay are included, according to McKinsey.

The more than 26 million people who have filed unemployment claims in the past five weeks provide only a partial picture of workforce dislocations, with tens of millions more facing additional risks, according to a report by economists including Susan Lund at the McKinsey Global Institute, the think tank arm of the consultancy.

The earliest wave of unemployment claims in mid-March disproportionately hit the food service, entertainment and hotel industries. The disruption has since moved into categories including retail, business services, manufacturing and non-essential health care.

There’s significant overlap between workers who are vulnerable because of the virus and those whose jobs were already at risk from automation, providing a challenge for the U.S. to train at-risk employees for more sustainable job opportunities.

Low-wage, part-time and minority workers are the most likely to be hurt by the pandemic, with 74% of at-risk jobs paying less than $40,000 a year, according to McKinsey’s analysis. But the number of full-time and white-collar positions being affected is rising, with 16% of vulnerable workers making more than $70,000 a year.

“It’s really the people who are generally lowest paid, less educated and least prepared to weather a spell of unemployment that are most at risk,” Lund said in a phone interview.

Education is the strongest demographic predictor of vulnerability, with people who don’t have bachelor’s degrees twice as likely to hold such jobs.

Companies can help by reducing hours and temporarily furloughing workers rather than firing them, McKinsey said. They also should offer greater flexibility to parents working from home and find ways to reconfigure office spaces to prevent a new virus outbreak. State workforce agencies can help provide training and education opportunities for the unemployed, McKinsey said.

SOURCE: Martin, E. (01 May 2020) “Virus impact may extend to 57 million U.S. jobs” (Web Blog Post). Retrieved from https://www.employeebenefitadviser.com/articles/virus-impact-may-extend-to-57-million-u-s-jobs