Many unemployed U.S. workers simply gave up trying to find work in September after months of the coronavirus pandemic and ensuing recession, the Wall Street Journal (WSJ) reports.
The labor force is shrinking in size in over half of the 30 states where unemployment rates fell, according to data released Tuesday by the Labor Department. The falling rates, WSJ writes, hid the truth of the decay of the labor market.
In September, the unemployment rate fell to 7.9 percent from its August number of 8.4 percent — but that was a double-edged sword that looked at both people who found jobs and others who’d decided to simply exit the labor force. In New York alone, there were 300,000 workers coming off the unemployment rolls, but a large percentage of those people just didn’t look for jobs. WSJ writes that this signaled a large portion of them who’d been employed in August had exited the workforce as well.
Because of the circumstances, some economists are wary of even pursuing month-over-month changes in state data, which can be volatile even in non-pandemic times. Now, they can be extra-distorted, WSJ writes.
Economists warn of cascading issues when people remain out of work too long. Their skills could deteriorate and then make it even harder for them to find jobs in the future.
Aside from the pandemic’s effects on the job market, its effects on those who are unbanked could be disastrous as well, PYMNTS writes. The rate of bankless Americans could rise by numbers still unknown, with the driving factor being the economic unrest that has pushed Americans out of work and kept them from making money over the past seven months.
While the number of unbanked Americans rose during the Great Recession in the early 2010s, it fell to 5.4 percent by last year. But now, as people remain out of work and the pandemic thrives, the number could rise again.