Economists Lengthen Recovery Timeline
A Wall Street Journal survey found that 43% of business and academic economists don’t see the U.S. gaining back lost jobs until at least 2023. That timeline is much longer than the timeline laid out by many economists earlier on in the pandemic, but not all that surprising considering the current state of the economy.
The Bureau of Labor Statistics reported that the U.S. had 11 million fewer jobs in September than in February, with 4 million of those losses coming in the leisure and hospitality sector. Economists were optimistic a few months ago that the recovery would be quick when significant jobs gains were made in early summer. However, hiring has slowed recently leaving many less confident of a quick recovery.
Another indicator that has left economists uneasy is the steadying level of unemployment claims. Jobless claims had been falling steadily from their March peak of about seven million until about a month ago. The number of people seeking unemployment benefits has been between 800,000 and 900,000 for the last six weeks, and there aren’t many indications of improvement soon. In fact, many are concerned claims could go up as the weather gets colder. The service sector in many parts of the country could be hit as outside options become less realistic, and fears of a second wave remain.
A big factor in the near-term prospects of the job market will be the stimulus talks in Washington. They have been hard to follow because each day’s reports seem to conflict the day before but keep reading to see what happens with any future bill.
I am not a financial advisor and my comments should never be taken as financial advice. Investments come with risk, so always do your research and analysis beforehand.