Americans are staying jobless for longer

3 December, 2020 12:00 AM printer

WASHINGTON: Eleanore Fernandez lost her job as an executive assistant when the coronavirus pandemic struck in March, and things have only grown worse in the months since, reports AFP.

Her husband, a professional musician, was also put out of work, and she is just weeks away from losing the US government unemployment benefits that have helped sustain Fernandez and her teenage daughter.

"I've never been in a situation where it's like, this hairy," Fernandez told AFP, noting she is "taking more out of my savings account." "I'm going to run out soon if nothing happens," she said.

The coronavirus pandemic caused the US economy to shed more than 20 million jobs, and though some people have been rehired, data shows the jobless are remaining out of work for longer as the virus again surges nationwide.

With the extra unemployment benefits approved by Congress set to lapse at the end of the year, economists warn the US labor face is facing long-term damage ahead of Joe Biden's inauguration as president in January.

"We've been concerned about longer run damage to the productive capacity of the economy," Federal Reserve Chair Jerome Powell said last month.

"Workers who are out of work for long periods of time, they may lose their contact with the labor market. They may lose their skills."

Labor Department data for October showed nearly 3.6 million people in the United States have been unemployed for at least six months.

That is equivalent to about a third of the total unemployed population, and is a sign a significant share of people who lost their jobs in the early weeks of the pandemic, in March and April, have not been able to find work.

The figure is 1.2 million higher than in September, making it "the highest month-over-month increase in history," Michele Evermore, senior policy analyst at the National Employment Law Project, told AFP.

Fernandez has spent fruitless months applying for work and is left to wonder what will happen when extended unemployment payments authorized by Congress in March run out on December 26.

"I'm going to have to take anything or deliver groceries, too, or something," she told AFP.

That dilemma is exactly what the central bank chief warned of and what analysts say will make the pandemic damage linger even after the virus is brought under control.

When "people lose attachment to the workforce, particularly once they fall off of unemployment insurance, they stop looking for work, they start figuring out something else, you know, turning to the informal economy," Evermore said.

The government is scheduled to release the November employment report on Friday, and Evermore predicted that, with the economy far from fully healed, the ranks of the long-term jobless will swell further.