CFE Analysis

The Jobs That Are Not Back

Friday’s employment report indicates almost half of the jobs that vanished in the Pandemic have been recovered.. But there are some industries where there has been hardly any recovery – and those are mostly businesses that will not come back completely until there is a widespread belief that COVID-19 is no longer a threat to what used to be considered normal activities.

Those businesses include travel, tourism, movies, and bars and restaurants.

Many of those industries have seen small increases in employment since the overall job market hit bottom in April but are still way below where they were in February.

Here are the changes in jobs for some industries for the six months since February:

Chart showing six month employment change, with big losses in movies, performing arts, and hotels.

The standout on that list is the federal government, and there the gain came largely from the hiring of temporary workers for the 2020 census. State and local governments have job losses that appear relatively small, but they are much larger than any six-month loss for such governments before this year – and they could get worse if there is no aid from Washington for governments whose tax revenues have plunged.

In the private sector, goods-producing industries have done better at coming back than have those companies that supply services, but no significant goods producing industry is back to February levels, based on seasonally adjusted employment figures from the Bureau of Labor Statistics.

The worst decline shown goes to the movie industry. It’s not easy to make a movie with masks and social distancing. Businesses depending on travel are way down, and so are the categories that include bars, restaurants and hotels. Some sports are back in operation, but without fans or the need for stadium employees. Many theatres and museums are still closed.

It may seem counterintuitive that a pandemic has led to a decline in health services employment, but it has. Many people would just as soon not see the doctor or dentist now for anything other than an emergency.

Overall, there is great news, or horrible news, depending on your preferred time frame. Over the last four months, the government estimates the number of jobs is up by 10.3 million, or 7.9%. There has never been that large a four-month increase, whether measured by the number of jobs or the percentage increase. You will hear about that from President Trump.

Over the past six months, however, the number of jobs is down by 10.5 million, or 6.9%. Before this year, there had never been a six-month stretch anywhere close to that bad. Don’t be surprised if Joe Biden mentions that.

If Mr. Trump’s four years in office were to end with employment at August levels, it would be down 3.9% since the end of 2016, by far the worst four-year term in post World War II history. The only such term to end with any decline was President George W. Bush’s first term, when the job total slipped by 0.1%.

If employment keeps rising for the rest of 2020, Trump’s term could end with a gain in jobs. But unless job gains average more than 4 million a month over the next four months, his administration would fall short of the 7.6% gain shown in Barack Obama’s second term. Biden might also mention that.

Without the pandemic, jobs did rise by a healthy 4.6% in Trump’s first three years of office. That was, however, still less than the 5.8% increase seen in the three previous years – the final three years of what Democrats now call the Obama-Biden administration.