Just because the economy is opening doesn’t mean all Americans will see the recovery they’ve been waiting for. And it’s true — the longer lockdown orders remain in place, the more difficult it will be for everyone once they’re lifted.
In the last five weeks, 26 million jobs have been lost across America. Some of these job losses are temporary, but others may become permanent—and that leads many to wonder what’s happening next. While unemployment is currently paying out a stimulus amount of $600 a week (on top of other benefits), those benefits will be exhausted in July.
Where will people find jobs if there aren’t any to have?
40% of the Jobs Lost May Be Permanent
It’s estimated that as many as 40 percent of the jobs lost could be permanent. When all is said and done, that could be around 12 million people who are suddenly unemployed. Temporary layoffs often become permanent because companies are already looking to go leaner. Further, companies are dealing with new economic realities, which means that it’s better for them to operate with reduced overhead.
Furthermore, some of the businesses that have furloughed employees may not come back themselves. Companies may be shuttering their doors, which means those jobs simply won’t exist anymore.
Unemployment Expected to Peak at 25%
According to Goldman Sachs, unemployment is likely to peak at 25%. Even when jobs do come back (which will happen slowly), unemployment may still linger at as high as 10%. This means that the country will need to get used to high unemployment rates for some time.
With many people having made more on unemployment than they did previously, some may have a full year of wages paid within the next three months. This will carry them through 2020, but may lead to people flooding the market looking for jobs throughout the tail end of the year.
At the core is a problem: Many jobs are being discovered to be superfluous, and businesses are inclined to cut these jobs during difficult times. Management positions, for instance, have been less useful in a time of remote work, and many companies are considering remaining remote only through the end of the year. Restaurants have been hard hit, leaving waiters and waitresses without a job — potentially for the indefinite future.
A Future for the Works Progress Administration
If unemployment lingers, it may very well be time to start a new Works Progress Administration. Following the depression, America created a division that employed Americans for public works, such as better roads and public buildings. Americans were able to acquire gainful employment while infrastructure was also able to be improved. If Americans were put to projects such as laying down fiber lines for better internet connectivity, it could be a tremendous boon to the economy, while also reducing the amount of those on unemployment.