Toll Worker Job Losses Highlight Long-Term Fallout of Pandemic

Patrick T. Harker, the president of the Federal Reserve Bank of Philadelphia, specifically mentioned the turnpike workers in his state as an example of the sort of lingering labor market weakness that policymakers should look out for.

“I expect that, as we recover, the economic picture will remain uneven, with wildly unequal outcomes across sectors of the economy,” he said last month. Consumer changes might roil the business travel industry, he said, displacing people who had worked at hotels and conference centers.

“I’d like to challenge all of us to think hard about ways to make sure the coming recovery is not only strong but equitable,” Mr. Harker said.

It is unclear how big the labor market reshuffle will be this time. On one hand, unemployment has come down faster than many economists expected, falling to 6.7 percent from a peak of 14.8 percent. But it is still high: Adjusting for people who have moved to the labor market’s sidelines, Fed officials regularly suggest that joblessness may have been about 10 percent in December.

In Europe, about 55 percent of employers expect to employ fewer people over the long term than they otherwise would have post-pandemic, according to a recent European Central Bank survey of 72 large companies across its currency bloc. That seems to reflect that “businesses have learned to maintain production in spite of restrictions on labor inputs due to social distancing,” the authors wrote.

It is hard to tell how widely companies are reaching a similar conclusion in the United States. And it matters what sort of jobs are lost. If people lose work in fields with transferable skills and working structures, they might be easier to move into new jobs. If they are highly specialized, it might be tougher.

“It’s not easy to change careers completely midcareer,” Mr. Powell said last week. “It would be wise as a country for the longer-run productive capacity of the country if we were to look out for those people and help them find their way back into the labor force, even if it means continuing support for an additional period of time.”

Article source: https://www.nytimes.com/2021/02/04/business/economy/toll-workers-layoffs-coronavirus.html