Although the labor market is very strong, if not too strong at the moment, there’s a sense of what could have been. The number of workers in the U.S. economy currently has exceeded pre-pandemic levels, but the impact of COVID has still been felt. If it weren’t for the pandemic, the labor market would’ve been even stronger, which was shown in a new study by economists from Stanford and MIT.
Figures show that the COVID-19 pandemic has made the U.S. labor force smaller by about 500,000 workers, and that number hasn’t improved even though the worst of the pandemic is behind us. Infection rates are still too high for this to get better as we enter what many epidemiologists are calling the “endemic” phase, and fear of COVID is listed as one of the reasons for the shrink in the labor force. One main reason for this was a lack of childcare during the pandemic, which kept many parents at home tending to their children. This was an issue President Biden tried to address in his Build Back Better plan, but it was shot down, as we all know. Some are saying that the study’s number is a conservative estimate due to the varieties of the dataset, but it gives deeper context as to what’s holding people back from getting jobs these days.
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.