#Neil Paine and Amelia Thomson-DeVeaux

[theliberaltony]

via Politics – FiveThirtyEight

For the past few months, Alicia Wertz has barely seen her husband. Since schools closed in their northern Alabama town in March, they’ve been single-mindedly focused on a single goal: making sure that someone was watching their three kids. At first, Wertz tried working from home. But she wasn’t getting anything done, so they tried splitting the hours: Wertz’s husband watches the children in the morning, then a sitter comes to relieve him in the afternoon until Wertz takes over when she returns from work.

“When we’re not working, we’re by ourselves with the children. It almost feels like you’re a single parent. All you do is go to work and care for the kids,” Wertz said.

In her mind, Wertz is counting down the days until schools reopen. But there’s a nagging worry at the back of her head — what if they don’t open at all? “The thought of [my kids] not going back in the fall is devastating,” Wertz said when we spoke in early July. “It raises this question of — if one of us has to stay home with the children, whose job is more important? I think it was something that we did have conversations about before, but COVID-19 has made it much worse.”

Wertz isn’t the only working mother for whom the thought of the fall calendar sparks both relief and dread. And what comes next could have disproportionate — and long-lasting — effects on the careers of countless women across the country. Studies have shown that women already shoulder much of the burden of caring for and educating their children at home; now, they’re also more likely than men to have lost their jobs thanks to the pandemic. And the collapse of the child care and public education infrastructure that so many parents rely on will only magnify these problems, even pushing some women out of the labor force entirely.

“We’re in danger of erasing the limited gains we’ve made for women over the past few decades, and especially women of color,” said Melissa Boteach, Vice President for Income Security and Child Care/Early Learning at the National Women’s Law Center.

The crux of the issue: Child care just isn’t as available as it was before the pandemic. Data provided to FiveThirtyEight by the job-search website Indeed shows that child-care services have been much slower to hire again (a useful proxy for re-opening) than other areas of the economy:

Combine that with the news that many schools will remain closed in the fall, and it’s easy to see the crisis at hand. If polling is any indication, the vast majority of the fallout is being weathered by mothers, who were already doing the majority of household work even before the pandemic began.

In 2015, the Pew Research Center asked parents about how they divide family responsibilities when both work full-time.1 Some tasks were split relatively evenly: Twenty percent of respondents said the mother disciplined children more, 17 percent said the father disciplined more, and 61 percent said that responsibility was shared equally. For every task, however, more respondents reported that the mother carried a greater amount of the load than those who said the father did — including areas involving managing children’s schedules, caring for children when they’re sick and handling household chores.

Moms usually shoulder more of the load at home

Share of parents in households with two full-time working parents who say each parent does more work in a given category, according to a Pew poll

Share of parents who say… Category Mother does more Father does more Work split equally Managing children’s schedules/activities 54% 6% 39% Taking care of sick children 47 6 47 Handling household chores, etc. 31 9 59 Playing/doing activities with children 22 13 64 Disciplining children 20 17 61

Based on 2015 poll by Pew Research, with a sample size of 531 respondents. The sample included male/female married couples only.

Source: Pew Research center

Along similar lines, Pew also found in a poll from 2019 that 80 percent of women living with a partner who had children did the primary grocery shopping and meal-preparation duties for their families. And according to the Bureau of Labor Statistics’ American Time Use Survey — which tracks the average amount of time people spend per day on different categories of activity — married mothers with full-time jobs spent 56 percent more time doing childcare and housework than corresponding fathers. By contrast, fathers spent more time on work-related tasks, travel and leisure activities.2

All that extra time moms spend really adds up

Daily time spent doing various activities by married parents of children under 18 who both worked full-time, according to the American Time Use Survey

Hours spent per day Activity Mothers Fathers Diff. Household activities 1.87 1.23 +0.64 Physical care for children 0.59 0.28 0.31 Child care – other 0.36 0.22 0.14 Child-related travel 0.25 0.13 0.12 Education-related activities 0.10 0.06 0.04 Reading with children 0.05 0.03 0.02 Playing/hobbies with children 0.27 0.29 -0.02 Total 3.49 2.24 1.25

Survey data covers the combined years of 2015 through 2019 and includes both opposite- and same-sex couples.

Source: bls.gov

Even under normal circumstances, it was difficult for mothers of young children to balance work against the heavy burden of child care. The BLS found that in 2019, the labor force participation rate for women with children under age 6 was 66.4 percent, well below the rate for women with children age 6 or older3 (76.8 percent). According to a 2014 survey by the U.S. Census Bureau, 61 percent of women who were out of a job and have young children listed “caretaking” as a reason why they were not employed. Forty-six percent of women who were out of a job and have older children said the same. To put that in perspective, only 10 percent of all respondents who were out of work gave caregiving as a reason.4

A similar strain is apparent in working mothers’ decisions to take unpaid leave, or even part-time jobs instead of full-time ones. According to that same census survey from 2014, 30 percent of women who were part-time workers with young children — and 19 percent of women with older children — said caretaking was a reason they worked part-time. (Among part-time workers, the overall share is just 7 percent.)5

Now, with schools closed and day cares struggling to remain open, even more women may conclude that the best — or perhaps the only — choice for their family and their own sanity is to reduce their hours, or even press “pause” on their career.

“Sometimes I’ll get to a point where I’m like, ‘I’m so tired, I’ll have to go part-time to make it all work,’” said Lee Dunham, a lawyer who lives in Delaware. Since the pandemic started, Dunham has been mostly responsible for her 10-month-old daughter during the day — which means her work day doesn’t start until 8 p.m. and usually wraps around 2 a.m.. “I’m just basically not getting enough sleep because I’m watching the baby 40 hours a week and doing my job 40 hours a week. It’s really rough.”

Dunham feels she’s lucky to have an understanding employer who told her earlier this year that they’d be cutting all of their employees some slack because of the pandemic. But at the time, she added, everyone was assuming day care would be up and running by mid-summer. “It might be that I have to dial back my hours, which of course means I will get paid less.”

This kind of calculus already depresses women’s wages and makes it harder for their careers to progress. According to the National Women’s Law Center, mothers are typically only paid 71 cents for every dollar paid to fathers. In fact, a lot of recent research into the gender pay gap has found that much of it is simply due to the constraints on working mothers. For instance, a 2018 analysis of data from Denmark — which offers a counterpoint to the United States in terms of social safety net, yet still has a very large and persistent gender wage gap — found that women’s earnings drop significantly after having their first child, while men’s earnings aren’t affected at all. And crucially, several studies in the U.S. and other countries have found that the trajectory of wages for women who don’t have children resembles those of men, whether they have kids or not (although some research has actually suggested that becoming a father can contribute to men’s career success).

This disparity is particularly intense for women of color. Black mothers are paid only 54 cents for every dollar paid to a white father, according to NWLC; for Latina mothers, it’s 46 cents. Low-income women of color are also among the likeliest to have lost their jobs in the current recession. And they’re disproportionately likely to be the child-care workers who are being asked to come back to work, sometimes in unsafe working conditions, for low wages. “We’re in a vicious cycle where we need child care as one of the tools to get women to equal pay, and yet unequal pay is one of the primary reasons that women are pushed into staying home,” Boteach said.

Leaving the workforce, even if it’s just for a year or two, has ripple effects that can follow a woman for the rest of her life, even depressing her earnings in retirement. Finding a new job after a few years on hiatus can be very difficult for mothers, who may be stereotyped as less serious about their careers because they took time off to be with their children. One study from 2007 found that mothers were perceived to be less competent than fathers, and their recommended salaries were also lower.

During this pandemic, you can already see the disproportionate impact taking shape. The unemployment rate for women in April was 16.2 percent, higher than it has been in any month since at least 1948, before dropping to 11.7 percent in June — a percentage point higher than the rate for men (10.6 percent). Even more striking, labor force participation for women dipped to 54.7 percent in April before rising to 56.1 percent last month. Both of those numbers are reminiscent of the rates for women from the 1980s — back when the very notion of women in the workforce was still gaining momentum.6

Wertz has no plans to leave her job — at least for now. “I worked incredibly hard to get to where I am now,” she said. “I essentially paid my way through school with no family support. For years I worked entirely too hard for not enough money.” Already, she worries that she’s perceived differently in the workplace because she’s a mother. “Even if it was just a year, I know how that gap would look on my resume,” she said. “If I had to take that step back, I just don’t know if I’d recover from it.”

[kristinsimmons]

Take Your Mom to Work

By KIM BELLARD

If you are a working mom, or married to one, or simply know one, you know that it is tough to balance a job and raising a child even under ideal circumstances.  Even if she has a supportive spouse, chances are that it is the mom who ends up providing the most child care, and whose career it impacts the most.

But, of course, these are not ideal circumstances.  Prior to the pandemic, women had made great strides in the workforce; more women had payroll jobs than men, for example (although they continued to be paid less for them).  Those gains quickly came crashing down once the pandemic hit.  It is believed to be the first time that job and incomes losses have hit women harder than men.  Some are calling our pandemic-driven economic downturn a “shecession” as a result.   

That’s bad enough, but the even bigger danger is that the pandemic could set back women’s careers for a generation. 

A recent study by Collins, et. alia confirmed what most might have guessed: in the wake of the pandemic, women are more likely than men to have reduced their work hours to take on additional child care responsibilities due to school/daycare closing — four or five times as much.  

The study found that:

Scaling back work is part of a downward spiral that often leads to labor force exits—especially in cases where employers are inflexible with schedules or penalize employees unable to meet work expectations in the face of growing care demands.  

We are also concerned that many employers will be looking for ways to save money and it may be at the expense of mothers who have already weakened their labor market attachment.

Even more worrying, lead author Caitlyn Collins, a professor at Washington University, says: “Our findings indicate mothers are bearing the brunt of the pandemic and may face long-term employment penalties as a consequence.”  

Five-Thirty-Eight’s Neil Paine and Amelia Thomson-DeVeaux analyzed how the pandemic could “force an entire generation out of the workforce.”  It starts with availability of child care, as shown in this chart:

Combine that with uncertainty about schools reopening and it makes child care decisions extremely tough.  Women with young children were already less likely to be in the workforce than other women, they point out, with caregiving cited as a major reason, and the pandemic is exacerbating the effect.  “Leaving the workforce,” they note, “even if it’s just for a year or two, has ripple effects that can follow a woman for the rest of her life, even depressing her earnings in retirement.”  

“We’re in danger of erasing the limited gains we’ve made for women over the past few decades, and especially women of color,” Melissa Boteach of the National Women’s Law Center told them.  

Trying to get the economy open again without figuring out how we’re going to support working moms is a “recipe for a generational wipeout of mothers’ careers,” Joan Williams, University of California Hastings College of Law and founder of the Center for WorkLife Law, told The Wall Street Journal.  

The WSJ article cites a Boston Consulting Group survey from this spring that found that both men and women were spending more time on domestic chores than pre-pandemic, but that the gap between women and men had increased from 10 hours per week to 15 hours.  “That’s almost two days more of a secondary job,” Matt Krentz, a managing director at BCG told WSJ. “When the trade off comes and it’s not sustainable, the solution often falls to the woman taking the step back.”

The article notes: “People who drop out of the labor force for an extended period not only miss out on pay, they also often fall behind on raises that come from longer tenure and employer contributions to retirement accounts.”  When you see “people,” read “women.”

Betsy Stevenson, a University of Michigan professor of economics and public policy, told The New York Times, “We could have an entire generation of women who are hurt.  They may spend a significant amount of time out of the work force, or their careers could just peter out in terms of promotions.”  

Professor Stevenson summed up what may be the core issue: “This pandemic has exposed some weaknesses in American society that were always there, and one of them is the incomplete transition of women into truly equal roles in the labor market.”

Deb Perelman, writing in The New York Times, puts the dilemma succinctly:  “In the Covid-19 economy, you’re allowed only a kid or a job.”  She goes on to add:

The long-term losses for professional adults will be incalculable, too, and will disproportionately affect mothers. Working mothers all over the country feel that they’re being pushed out of the labor force or into part-time jobs as their responsibilities at home have increased tenfold.

It’s outrageous, Ms. Perelman believes, and she wonders: 

“Why isn’t anyone talking about this? Why are we not hearing a primal scream so deafening that no plodding policy can be implemented without addressing the people buried by it?”

Why, indeed.  

In an op-ed in The New York Times, Professor Williams asserted: 

We’re in this mess because, even before coronavirus, the legal protections for working mothers consisted of a convoluted matrix of federal, state and local laws…The lack of straightforward legal protections is just one of many ways that public policy fails mothers; the haphazard nature of Families First is merely one symptom of a broader problem.

As The New York Times noted: “In countries that offer more comprehensive support for families — like Germany, France, Canada and Sweden — a significantly larger proportion of women are in the labor force.”   

This is, of course, an issue of particular importance to healthcare. According to the Census Bureau, women make up 76% of the healthcare labor force. Child care considerations may drive much of the gender imbalances by specialty for women physicians and other healthcare workers. When COVID-19 hit, essential healthcare workers struggled to find child care that allowed them to keep working. These factors shape our healthcare workforce and our healthcare system.

It’s hard to picture now, but the pandemic will eventually pass.  Perhaps we’ll get a vaccine, perhaps it will have to run its course through the population.  Most, but not all, jobs will come back; the economy will improve.  We���ll settle into a new normal.  All that will cost trillions of dollars, hardships for millions, and way, way too many lives.  

Most of the damage, though, will be measured in months or years — not generations.  Unless we proactively take action, though, these impacts on women’s careers can be generational.  The pandemic may galvanize action on, for example, unemployment programs/systems and our healthcare system.  We need that same will to action on supporting working moms, such as through better family leave and child care policies.

Do it for your mom. 

Kim is a former emarketing exec at a major Blues plan, editor of the late & lamented Tincture.io, and now regular THCB contributor.

Take Your Mom to Work published first on https://wittooth.tumblr.com/

[lauramalchowblog]

Take Your Mom to Work

By KIM BELLARD

If you are a working mom, or married to one, or simply know one, you know that it is tough to balance a job and raising a child even under ideal circumstances.  Even if she has a supportive spouse, chances are that it is the mom who ends up providing the most child care, and whose career it impacts the most.

But, of course, these are not ideal circumstances.  Prior to the pandemic, women had made great strides in the workforce; more women had payroll jobs than men, for example (although they continued to be paid less for them).  Those gains quickly came crashing down once the pandemic hit.  It is believed to be the first time that job and incomes losses have hit women harder than men.  Some are calling our pandemic-driven economic downturn a “shecession” as a result.   

That’s bad enough, but the even bigger danger is that the pandemic could set back women’s careers for a generation. 

A recent study by Collins, et. alia confirmed what most might have guessed: in the wake of the pandemic, women are more likely than men to have reduced their work hours to take on additional child care responsibilities due to school/daycare closing — four or five times as much.  

The study found that:

Scaling back work is part of a downward spiral that often leads to labor force exits—especially in cases where employers are inflexible with schedules or penalize employees unable to meet work expectations in the face of growing care demands.  

We are also concerned that many employers will be looking for ways to save money and it may be at the expense of mothers who have already weakened their labor market attachment.

Even more worrying, lead author Caitlyn Collins, a professor at Washington University, says: “Our findings indicate mothers are bearing the brunt of the pandemic and may face long-term employment penalties as a consequence.”  

Five-Thirty-Eight’s Neil Paine and Amelia Thomson-DeVeaux analyzed how the pandemic could “force an entire generation out of the workforce.”  It starts with availability of child care, as shown in this chart:

Combine that with uncertainty about schools reopening and it makes child care decisions extremely tough.  Women with young children were already less likely to be in the workforce than other women, they point out, with caregiving cited as a major reason, and the pandemic is exacerbating the effect.  “Leaving the workforce,” they note, “even if it’s just for a year or two, has ripple effects that can follow a woman for the rest of her life, even depressing her earnings in retirement.”  

“We’re in danger of erasing the limited gains we’ve made for women over the past few decades, and especially women of color,” Melissa Boteach of the National Women’s Law Center told them.  

Trying to get the economy open again without figuring out how we’re going to support working moms is a “recipe for a generational wipeout of mothers’ careers,” Joan Williams, University of California Hastings College of Law and founder of the Center for WorkLife Law, told The Wall Street Journal.  

The WSJ article cites a Boston Consulting Group survey from this spring that found that both men and women were spending more time on domestic chores than pre-pandemic, but that the gap between women and men had increased from 10 hours per week to 15 hours.  “That’s almost two days more of a secondary job,” Matt Krentz, a managing director at BCG told WSJ. “When the trade off comes and it’s not sustainable, the solution often falls to the woman taking the step back.”

The article notes: “People who drop out of the labor force for an extended period not only miss out on pay, they also often fall behind on raises that come from longer tenure and employer contributions to retirement accounts.”  When you see “people,” read “women.”

Betsy Stevenson, a University of Michigan professor of economics and public policy, told The New York Times, “We could have an entire generation of women who are hurt.  They may spend a significant amount of time out of the work force, or their careers could just peter out in terms of promotions.”  

Professor Stevenson summed up what may be the core issue: “This pandemic has exposed some weaknesses in American society that were always there, and one of them is the incomplete transition of women into truly equal roles in the labor market.”

Deb Perelman, writing in The New York Times, puts the dilemma succinctly:  “In the Covid-19 economy, you’re allowed only a kid or a job.”  She goes on to add:

The long-term losses for professional adults will be incalculable, too, and will disproportionately affect mothers. Working mothers all over the country feel that they’re being pushed out of the labor force or into part-time jobs as their responsibilities at home have increased tenfold.

It’s outrageous, Ms. Perelman believes, and she wonders: 

“Why isn’t anyone talking about this? Why are we not hearing a primal scream so deafening that no plodding policy can be implemented without addressing the people buried by it?”

Why, indeed.  

In an op-ed in The New York Times, Professor Williams asserted: 

We’re in this mess because, even before coronavirus, the legal protections for working mothers consisted of a convoluted matrix of federal, state and local laws…The lack of straightforward legal protections is just one of many ways that public policy fails mothers; the haphazard nature of Families First is merely one symptom of a broader problem.

As The New York Times noted: “In countries that offer more comprehensive support for families — like Germany, France, Canada and Sweden — a significantly larger proportion of women are in the labor force.”   

This is, of course, an issue of particular importance to healthcare. According to the Census Bureau, women make up 76% of the healthcare labor force. Child care considerations may drive much of the gender imbalances by specialty for women physicians and other healthcare workers. When COVID-19 hit, essential healthcare workers struggled to find child care that allowed them to keep working. These factors shape our healthcare workforce and our healthcare system.

It’s hard to picture now, but the pandemic will eventually pass.  Perhaps we’ll get a vaccine, perhaps it will have to run its course through the population.  Most, but not all, jobs will come back; the economy will improve.  We’ll settle into a new normal.  All that will cost trillions of dollars, hardships for millions, and way, way too many lives.  

Most of the damage, though, will be measured in months or years — not generations.  Unless we proactively take action, though, these impacts on women’s careers can be generational.  The pandemic may galvanize action on, for example, unemployment programs/systems and our healthcare system.  We need that same will to action on supporting working moms, such as through better family leave and child care policies.

Do it for your mom. 

Kim is a former emarketing exec at a major Blues plan, editor of the late & lamented Tincture.io, and now regular THCB contributor.

Take Your Mom to Work published first on https://venabeahan.tumblr.com

[theliberaltony]

via Politics – FiveThirtyEight

Graphics by Jasmine Mithani

Congress is back in session, and it has a weighty task before it — figuring out what to do about the economy as COVID-19 infections spike across the country and states roll back their reopenings. One central point of tension: the $600-per-week supplemental unemployment insurance benefit that was enacted in March as part of the CARES Act and is set to expire on July 31.

Democrats have proposed extending the payment until jobless rates in states fall below a certain threshold. Republicans, meanwhile, are leery of continuing the full payments, saying they will discourage people from returning to work. And it’s true that research has shown that many workers are making more money on the beefed-up benefits than they would be at their old jobs.

But in the latest installment of our regular survey of quantitative macroeconomic economists,1 conducted in partnership with the Initiative on Global Markets at the University of Chicago Booth School of Business, the 33 economists in our study collectively thought there was a 59 percent chance that either keeping the payment steady or increasing it to above $600 per week would be most beneficial to the economy. They said there was about a 33 percent chance that reducing the weekly payment to less than $600 would most benefit the economy, and only a 7 percent chance that letting the program completely lapse would be most beneficial. This makes sense considering that another recent IGM survey found that most economists blamed high unemployment on companies that weren’t hiring — not on people choosing not to work because of unemployment payments.

Jonathan Wright, an economics professor at Johns Hopkins University who has been consulting with FiveThirtyEight on the design of the survey, pointed out that some extension of unemployment insurance is important because many workers are still out of a job. States can continue to offer benefits regardless of what the federal government does, but those don’t last forever, either — and some states are less generous than others.

How should Congress handle unemployment insurance?

Likelihood that each federal policy choice would most benefit the entire economy over the rest of 2020, according to economists

Option Probability Keep the weekly payment at $600 37% Reduce the weekly payment to less than $600 33 Increase the weekly payment to more than $600 22 Allow federal pandemic unemployment insurance to completely lapse 7

The survey of 33 economists was conducted July 17-20.

Source: FIVETHIRTYEIGHT/IGM COVID-19 ECONOMIC SURVEY

Of course, the perspectives on Congress’s response are nuanced, and many of the economists think the benefits should ideally be phased out as the economy improves, assuming there are no logistical hurdles. When we drilled into some of the ways that federal policymakers could aid jobless workers, the experts thought there was a 37 percent chance that the best strategy would be to continue paying jobless workers $600 weekly for now but peg federal unemployment benefits to key economic indicators so they become gradually less generous as the economy improves. They said there was a 26 percent chance it would benefit the economy more if the workers were paid less than $600 per week for a fixed period of time, and a 22 percent probability that it would be better to continue paying jobless workers $600 a week even if it meant some would make more than they did while working.

Deborah Lucas, an economist at MIT, said she would opt for temporarily leaving the weekly payment at $600, or even increasing it a bit, although she said the payments should ramp down if the economy improved enough. “The fact that a considerable number of people are making more this way than when they were working seems like a good thing,” she said, adding that this will only be true for low earners, who might otherwise feel pressure to take jobs that would endanger their health. “In effect, it enhances social insurance protections and is a step towards universal basic income, both policies I think would improve social welfare even in the absence of a pandemic.”

Not all of the economists were a fan of expanding or maintaining the $600 weekly payment, though. Annette Vissing-Jørgensen, an economist at the University of California, Berkeley, said it was fundamentally unfair that some essential workers were making less money than nonessential workers who were out of a job. She added that while she’s concerned overall about making it more financially attractive for workers to stay home from their jobs, particularly if hiring starts to pick up again, there “could be a role for continuing some level of extra benefits” in states that are less generous. Others noted that while the extra payment made sense as a short-term stimulus measure, economists might approach the long-term consequences of such a generous supplement differently.

Still, it was notable that the least popular response to the question above was an alternative to the $600-per-week payment that’s been floated by some Republicans, who have proposed a “back to work bonus” for people who return to their jobs instead of continuing to supplement workers’ unemployment benefits. Economists thought there was only a 16 percent chance this would do the most to benefit the economy.

“Continued unemployment support has the twin benefits of alleviating poverty for jobless workers and sustaining consumer demand in the economy,” said Allan Timmermann, professor of finance and economics at the University of California, San Diego. Timmermann has also been consulting with us on the survey. “[It] is viewed as a highly effective tool to prevent the economy from stalling.”

Along similar lines, we asked economists how they would allocate $1 trillion in a hypothetical COVID-19 stimulus package if they wanted to do the most good for the entire economy (with the assumption that the health crisis itself would be addressed with a separate bill). The economists ranked their top three priorities and gave unemployment insurance the highest share of No. 1 responses. But though that benefit was in the top three of priorities for a majority of the experts, at 67 percent, it didn’t see the highest share of overall top-three responses. By that measure, the clear priority according to economists was funding state and local governments — which is consistent with a previous survey in which they thought one of the most likely causes of economic disaster would be an unwillingness to bail out those governments. In this week’s survey, 85 percent of respondents thought that should be among lawmakers’ top three priorities, and 36 percent said it should be No. 1.

What should be the priorities of a federal stimulus?

Priorities for a hypothetical federal stimulus package in order to have the greatest overall economic benefit, ranked by economists

Share of economists who ranked it as priority … Category No. 1 No. 2 No. 3 In Top 3 State and local governments 36% 21% 27% 85% Jobless workers (via unemployment insurance) 39 15 12 67 Small businesses 6 21 21 48 Public K-12 schools 12 15 18 45 Individuals (via stimulus checks) 3 21 12 36 Health care institutions 0 6 9 15 Other 3 0 0 3 Higher education 0 0 0 0 Large corporations 0 0 0 0

The survey of 33 economists was conducted July 17-20.

Source: FIVETHIRTYEIGHT/IGM COVID-19 ECONOMIC SURVEY

“State and local is going to be a huge drag on the economy because they are a sizable share of spending, cannot really run much in the way of deficits, their tax revenue is badly hit and Congress has done little to help so far,” Wright said. So cushioning states and localities could do a lot to support the economy, he said.

Other areas of focus that frequently came up among the economists’ top three priorities were funding for small businesses (48 percent) and public K-12 schools (45 percent) and another round of individual stimulus checks (36 percent). None of our economists, however, thought funding either large corporations or colleges and other institutions of higher learning was a priority.2

In addition to our usual questions about gross domestic product in the second and fourth quarters, we asked the economists to forecast third-quarter real GDP growth in this installment of the survey. The results shed some light on just how much the prospect of a true “second wave” of coronavirus in the winter could slow down economic growth.

On average, economists thought real GDP in the second quarter of 2020 — which ended June 30, with an advance GDP estimate set to be released later this month — declined by an annualized rate of 27 percent compared with the first quarter. They also thought real GDP would grow by about 8 percentage points quarter-over-quarter in the third quarter, with an upper-bound estimate of 17 percent and little chance of negative growth again. But their forecasts looked bleaker for the fourth quarter, with a median forecast of 3 percent growth, a 90th-percentile forecast of 9 percent and a 10th-percentile forecast in the red again (at -3 percent) — all more pessimistic than in the third quarter.

Some of that reflects the increased economic activity of the summer (relative to the early spring), even with the virus circulating around the country; the likelihood of some kind of third-quarter bounce back was high, given how bad economists think second-quarter GDP will end up. But the forecast also speaks to the uncertain course that the virus — and therefore, the economy — might take over the rest of 2020.

Robert Barbera, an economist at Johns Hopkins University, said part of the problem in forecasting quarterly shifts is that month-to-month change can be so extreme. His forecast for the third quarter was less optimistic because he expected most of the initial bounce back to happen in May and June, which are both part of the second quarter. The third quarter might see an uptick in August and September and look quite a bit better than the second quarter, he said, but that’s partially because the second quarter was so bad. Predicting the fourth quarter is even more difficult — in part because a bounce back in the economy is so dependent on Americans’ willingness to resume ordinary life.

However the course of the recession plays out, our economists think America could be due for a massive wave of personal bankruptcies in the second half of the year. During the first half of 2020, total bankruptcy filings — the vast majority of which were by individuals — were actually down 23 percent relative to the first half of 2019, according to court data from Epiq AACER. But don’t be fooled: That was almost certainly because of the heavy use of grace periods and extensions by creditors, which will eventually expire (if they haven’t already). In our survey, 67 percent of economists thought total filings would increase significantly in the second half of 2020 relative to the second half of 2019; only 6 percent thought they would see the same kind of year-over-year decrease in the second half of 2020 that they saw in the first half.

Taken as a whole, the economic picture painted by this week’s survey is no brighter than in previous installments. The panel’s predictions for future GDP have scarcely budged over the past two weeks, and the experts remain wary that whatever gains the economy is making over the summer could be wiped out by the virus before year’s end. But they also clearly think Congress has a few tools at its disposal to avoid making the recovery harder than it needs to be. The big question is — will policymakers use them?

[theliberaltony]

via Politics – FiveThirtyEight

Graphics by Anna Wiederkehr

The National Bureau of Economic Research announced on Monday that the U.S. is officially in a recession. But while the country’s economy is still in dire straits, economists now think the recovery might be quicker — and less painful — than they were expecting a few weeks ago. Our survey of 34 quantitative macroeconomic economists, conducted in partnership with the Initiative on Global Markets at the University of Chicago Booth School of Business, found that respondents are increasingly optimistic about the country’s economic trajectory — at least when it comes to employment.

That newfound hope is mostly because of the jobs report released last week. Many of our sample of economists, who work in academic settings, had predicted that the unemployment rate would rise even further — in our first survey in this series, the median prediction was 20 percent. That turned out to be pretty far off the mark: The unemployment rate actually fell from 14.7 percent in April to 13.3 percent in May. The economists who responded to this week’s survey, conducted June 5 through 8, expect that trend to generally continue next month: On average, they estimated that the unemployment rate for June will be 12.9 percent. They also thought the labor market will be in an even better position at the end of the year. The average forecast for the unemployment rate in December was 10.6 percent, and the consensus forecast was that there is a 46 percent chance of the unemployment rate dropping below 10 percent by the end of 2020 (as opposed to an 18 percent chance in our last survey).

But the better-than-expected jobs numbers didn’t convince the economists in our survey that the economy will be back to normal anytime soon. Their forecasts for growth in gross domestic product, for instance, didn’t change much over the past few weeks. Respondents do think the economy will be growing by the end of the year — but nowhere near as quickly as it fell. “Clearly, the economy has started to climb out of the hole, but it’s a very deep hole to start with, and our respondents are not confident that we have begun a strong and sustained recovery,” said Allan Timmermann, professor of finance and economics at the University of California, San Diego. Timmermann and Jonathan Wright of Johns Hopkins University have been consulting with us on the design of the survey.

The forecasters were moved by last week’s jobs news, at least. Those who participated in both rounds of the survey revised their estimates for December’s unemployment rate down by 2.1 percentage points, on average. Mainly, that came from forecasters who had expected very bad unemployment numbers later this year coming down off those estimates: The third of respondents who forecast the highest median December unemployment rates in Round 1 revised their estimated rate down by an average of 3.7 percentage points. (The third who forecasted the lowest rates in Round 1, meanwhile, only revised their estimates down by an average of 0.4 points in Round 2.)

One of the economists who reduced their estimates the most was Wright. “I was very surprised by the May jobs number,” he said. “I had expected a number up around 17 or 18 percent in June with continuing job losses. It looks to me like the process of calling people back to work has begun earlier than I had expected. The fact that it begins early somewhat reduces the damage done and so makes the outlook for the second half of the year better.”

Valerie Ramey, professor of economics at University of California, San Diego, echoed Wright’s more hopeful sentiments. “The jobs report for May was a complete surprise to me (and many others),” Ramey said. “States are loosening up restrictions faster than I anticipated.” She added that the combination of those two factors — along with what she saw as “promising evidence on the COVID front” — made her more optimistic about both the pandemic and the economy. “If COVID is not so deadly, I think that even a second spike in cases will not result in severe lockdowns, such as the one we have just experienced.”

But not every expert we surveyed was equally swayed by the less-horrible-than-expected unemployment figures. Menzie Chinn, professor of public affairs and economics at the University of Wisconsin, said he was weighing the Bureau of Labor Statistics’ ongoing difficulties in collecting data on laid-off workers, along with developments in COVID-19 cases. He kept his December unemployment forecast the same as it had been two weeks ago, when his forecast was among the most optimistic. He told us he anticipated that the BLS will eventually be able to resolve an issue with worker classification that may have excluded some furloughed workers, which could cancel out the effect of more people going back to work. Unlike Ramey, he was expecting a resurgence in cases that could lead to new state-level lockdowns. “In this respect I’m more of a pessimist than the average respondent, I expect,” he said.

And even if the latest consensus is that the labor market is rebounding more quickly than expected, the economists weren’t optimistic that unemployment will plummet over the coming months. In our first survey, experts thought there was a 37 percent probability that the unemployment rate wouldn’t return to single digits until the second half of 2021 or later; now that probability is only 20 percent. Yet they still think it’s more likely than not that unemployment stays above 10 percent the entire rest of 2020.

“The rebound in jobs in the May data may be the easy part of the recovery in the sense that some workers were furloughed and are being called back as the economy reopens,” Wright said. “But other workers have more permanently lost their jobs.”

Still, the survey was somewhat sanguine about unemployment overall. That was also true for the experts’ assessment of what will happen with inflation. We asked experts whether they thought the core personal consumption expenditure inflation rate would either drop below zero (i.e., deflation), stay between 0 and 3 percent — where it has consistently sat for decades — or rise above 3 percent by the end of 2022. Our sample of economists thought there was an 80 percent chance it would stay in its usual range, with a 13 percent chance of inflation over 3 percent and a 7 percent chance of deflation. So despite concerns that the Federal Reserve’s monetary response to the coronavirus could cause runaway inflation or deflation, the consensus is that inflation rates will remain in a relatively normal range.

That measured confidence did not extend to overall economic growth, however, as the panel’s forecasts for GDP barely budged over the past two weeks. The average estimated second-quarter (annualized, quarter-over-quarter) GDP growth in the survey is now -26.1 percent, with an 80 percent confidence interval between -35 percent and -18 percent. While respondents thought there was slightly more of a chance that GDP recovers sooner than 2022, they increased the odds of it happening by the middle of 2021 only from 11 percent to 12 percent:

When will real GDP catch up to its pre-crisis (Q4 2019) level?

Consensus-forecast probabilities for when U.S. gross domestic product will return to its pre-coronavirus level, by date of survey

Probability Timeframe Round 1 (May 25) Round 2 (June 8) Earlier than the 1st half of 2021 0.6% 1.7% 1st half of 2021 10.7 10.5 2nd half of 2021 17.5 21.0 1st half of 2022 18.6 22.0 2nd half of 2022 21.4 20.1 Later than the 2nd half of 2022 31.3 24.6

Probabilities are based on the average from a survey of 34 economic experts.

Source: FiveThirtyEight/IGM COVID-19 Economic Survey

Although respondents think GDP will probably be growing at the end of the year (with an expected final-quarter growth estimate of +4.2 percent on average), that number is unlikely to be large enough to offset the economic damage from when the recession began — although it also depends, of course, on how much the economy recovers in the third quarter. And uncertainty about GDP remains as high as ever. In fact, the average range between the upper and lower bounds of respondents’ 80 percent confidence interval about second-quarter GDP growth increased from 17.5 percentage points two weeks ago to 18.2 points this week.

Karen Dynan, an economics professor at Harvard University and former chief economist at the U.S. Department of Treasury, said she remained pessimistic about second-quarter GDP because the reopening of the economy was mostly unfolding the way she expected. The more difficult exercise, she told us, was trying to predict what will happen in the second half of the year because there are still so many unknowns — like our limited understanding of the virus, a lack of information about how consumer and household finances are being affected, and how effective the government will be at implementing public health measures that make people feel comfortable leaving their homes again.

So while the jobs report appears to have made many of the respondents in the survey think the recovery won’t be as painful as they initially predicted, they also don’t think it’s a sign that the economy will be bouncing back quickly. Overall, the economists stressed that we shouldn’t read too much into one good jobs report — and that the jobs report provided only a small measure of hope to an economic outlook that remains bleak otherwise.

“In the recovery, we will see some months and quarters of much improved economic conditions, but this still does not mean that the economy is back to health,” Wright said. “1933 was a year of great growth, but it was still in the depths of the Great Depression.”

[theliberaltony]

via Politics – FiveThirtyEight

Graphics by Yutong Yuan

All across the country, the gears of the economy are grinding slowly and creakily into motion. Retail stores are newly open for in-person shopping in California. It’s possible to get a much-needed haircut in Alabama. And in Alaska, bartenders are even slinging drinks again — albeit with strict capacity and spacing limits.

The reopening of the economy might seem like a promising sign. After all, as shuttered stores and restaurants reopen, workers can return to their jobs or look for new positions, and industries that have seen slowdowns can resume operations. Some politicians — including President Trump — have promised a fast recovery.

But how quickly will the economy really be able to bounce back? How long will we be stuck with a double-digit unemployment rate and a host of other historically bad economic indicators?

We wanted to get a sense of what the experts were thinking. So we partnered with the Initiative on Global Markets, a research center at the University of Chicago Booth School of Business, to survey a group of quantitative macroeconomic researchers who work in academic settings about the trajectory of the economic crisis. In consultation with Jonathan Wright of Johns Hopkins University and Allan Timmermann of the University of California, San Diego, two experts on macroeconomic forecasting, we asked the panel questions like what the shape of the recovery will resemble, when gross domestic product will return to its pre-crisis levels, and what the unemployment rate will be at the end of the year. The survey was conducted May 22 to 25.

Overall, the researchers predicted that although the economy will probably start to improve in the second half of this year, there won’t be a quick rally from this recession. “The panelists believe, on the whole, that the recovery from this crisis is going to be a very, very lengthy process,” Timmermann said. “We’re going to be seeing serious effects for years and years.”

Our sample of economists thought it was more likely than not — with an average probability of 54 percent — that the next quarter to see positive real GDP growth in the U.S. (relative to the previous quarter) would be the third quarter of 2020. But that’s probably a low bar to clear; the economy shrunk by 4.8 percent in the first quarter and is likely to contract even more in the second quarter. And there’s a significant chance that the contractions could continue further into the future: The forecasters we polled thought there was a 23 percent chance that the economy would not grow again until the fourth quarter of 2020 and a 22 percent chance that it wouldn’t grow until the first quarter of 2021 or later.

“The economy almost has to grow [in the third quarter] because we’ll be starting from such a low base,” Wright said. “Unless, of course, things seem to be looking good right now and then in July or August there’s another wave and we go straight back to lockdown. Then you could have another negative quarter.”

Another way to think about the recovery process is by considering the shape of the recession. We presented the economists with four specific options of how the trajectory of GDP might look as charted over 2020 and beyond: V-shaped, with a sharp fall and a sharp rebound; U-shaped, with a long period between the beginning of the recession and the recovery; W-shaped, with a sharp recovery followed by another sharp fall and recovery; or “Swoosh”-shaped, with a sharp decline followed by a very slow recovery (picture the Nike logo). More than half of respondents — 58 percent — thought the long, slow recovery of a “Swoosh” shape was most likely, with 19 percent predicting a U-shape and 13 percent calling for a W-shape with multiple declines and recoveries. Tellingly, only 1 out of 31 economists forecasted a V-shape, which would see a quick recovery after the sharp decline of the past few months.1

That pessimistic outlook also came through in our panel’s predictions for when the economy might return to the way it was before the pandemic. The researchers predicted, on average, only an 11 percent chance that real GDP will have caught up to its pre-crisis (fourth quarter of 2019) level by the first half of 2021 and only a 17 percent chance that it will have caught up to its pre-crisis level by the end of 2021. On average, they thought there was roughly a 40 percent probability that GDP would return to its pre-crisis levels sometime in 2022. But they assigned a 32 percent chance to the possibility that GDP wouldn’t return to its pre-crisis level until 2023 or later. Wright pointed out, too, that matching the pre-crisis GDP still isn’t a full recovery, since the economy would have continued to grow if the recession hadn’t happened.

There was a similarly bleak prediction for the unemployment rate. The forecasters’ median estimate for the unemployment rate in May’s jobs report, which will come out on June 5, was 20 percent. By the end of the year, they think the unemployment rate will still be very high by historical standards — the median estimate for the unemployment rate in the December jobs report, which will come out in January 2021, was 12 percent.

In general, the consensus of the forecasters was that there is only an 18 percent chance that the unemployment rate will fall below 10 percent this year, and a 36 percent chance that it won’t fall below 10 percent until after the second quarter of 2021 — over a year from now.

To give you an idea of how terrible a double-digit unemployment rate potentially sustained over 21 months would be, the unemployment rate had been at or above 10 percent for only 11 months total from 1948 through 2019.

But forecasting our economic future is a challenging business even when we’re not in the middle of a global pandemic. And as our respondents filled out their questionnaires, they were weighing a lot of unknowns and making their own assumptions about the trajectory of the virus and the economic crisis — including when a vaccine will be developed, how quickly businesses can get up and running, and even whether there will be a second wave of COVID-19 outbreaks in the summer or fall. Our economic indicators aren’t really designed to capture such a quickly unfolding crisis, which makes it even more difficult to predict what they’ll be saying a month or a year from now. “I assumed a base scenario where there’s a slow lifting of lockdown orders and no reversal,” Wright said. He also assumed there would be continued support from the Federal Reserve and Congress. “But what if there’s a big standoff in Congress and unemployment benefits don’t get extended? What if there’s a second wave of the virus?”

As such, many of the experts predicted a wide range of possible outcomes, particularly on questions that required them to project more than a few months into the future. For example, the economists’ median prediction for what the unemployment rate would be in the December 2020 jobs report — 12 percent — was just a little lower than the unemployment rate in the April jobs report (14.7 percent). But the experts’ confidence in their responses varied a lot — with upper-bound estimates ranging from 10 to 30 percent and lower-bound estimates ranging from 6 to 15 percent.

You can also see this uncertainty in our earlier question about when GDP will finally recover. The economists agreed that it was unlikely for real GDP to return to where it was before the COVID-19 pandemic anytime soon. But beyond that, they weren’t particularly sure when a recovery might happen.

None of these projections are especially encouraging — remember, the unemployment rate was only 3.5 percent back in February, and the peak during the Great Recession was 10 percent. But they’re also an important reminder of just how much is up in the air right now, as we scramble to simultaneously contain the virus and rev up the economy.

We’ll be checking in with the panel of economists periodically as the pandemic and economic crisis continue to unfold. Their predictions will likely shift as the economy reopens and the long-term public health response becomes clearer. But right now, even the experts don’t seem to be expecting a rapid rebound from this recession — in fact, the economic pain of the COVID-19 crisis could be with us for years.

[theliberaltony]

via Politics – FiveThirtyEight

These days, reading the monthly jobs report can feel like opening a time capsule. According to the data for June, which was released today, the recovery from the COVID-19 recession was still chugging along as of the middle of last month, when the two surveys that form the backbone of the report were conducted. The unemployment rate fell from 13.3 percent in May to 11.1 percent in June, and 4.8 million more people were employed in June than in May.

Those numbers look promising — but it’s important to remember that they’re just a snapshot of what the economy looked like in mid-June. And a lot has changed since then. Most importantly, COVID-19 infections have spiked in states across the country, and many governors have rolled back the phased reopenings that brought many jobless workers back into the labor force. That could have a seismic impact on the sectors of the economy, like leisure and hospitality, that saw the biggest gains in June.

Even underneath the surface of the June report, there were signs that the recession is deepening. Crucially, the number of workers who have permanently lost their jobs rose quite a bit — signaling that for an increasing number of Americans, getting back to work won’t be an easy matter. And the unemployment rate for white Americans continues to be much lower than the unemployment rate for Black, Hispanic or Asian Americans. That’s an important reminder that some workers are continuing to do much better than others as the recovery creaks into gear.

If you just focus on the report’s headline numbers — the unemployment rate and number of payroll jobs — the country’s economic situation was looking up in June. In fact, the drop in the unemployment rate may have been even more dramatic than the topline number lets on. Over the past few months, the Bureau of Labor Statistics has been struggling with an issue that’s unique to our pandemic-ridden times: A substantial number of workers were reporting that they were absent from their jobs for the entire week referenced in the survey for “other reasons.” That probably meant they were temporarily out of work because of COVID-19 — but they weren’t counted as unemployed.

To be clear: The BLS has been extremely transparent about the presence of this problem, and it does not mean that the numbers were fudged. Our methods for measuring unemployment are simply not designed for a pandemic-induced recession. But it is important to take the misclassification issue into account because if those workers had been included in April, BLS estimates that the unemployment rate would have been about 20 percent; in May, the rate would have been about 16 percent. By June, the BLS reported that it mostly had the misclassification issue under control — which meant the actual unemployment rate declined even more substantially, to around 12 percent.

Bear in mind, though, that we still have a long way to go before we’re anywhere near pre-pandemic levels of unemployment. It’s all about your frame of reference: An 11.1 percent unemployment rate is stunningly low compared with where we were in April, when close to 20 percent of the population was unemployed. But it’s still higher than at any point in modern history — including the unemployment rate at the apex of the Great Recession.

And there are many reasons to believe that the recovery could stall — or even backslide — in the coming months. One clue is tucked in the June report: Of those who did lose jobs, a larger share of them were permanent than in previous months.

In April and May, 88.6 percent of job losses were classified by the BLS as “temporary,” which fit the early theme of this recession: Businesses shut down temporarily to stop the spread of COVID-19 but planned to reopen later as the virus came under control — particularly with the assistance of government loans such as the Paycheck Protection Program, which incentivized small businesses to keep employees on payroll during the closures. But in June, the share of job losses that were temporary fell to 78.6 percent, a sign that a growing number of workers will not have a job waiting for them when the crisis lifts.

“As more job losses become permanent, this recession will look more and more like an ordinary recession, where in recent history the recovery has been a slow slog,” said Nick Bunker, the director of economic research for North America at the Indeed Hiring Lab, a research institute connected to the job-search site Indeed. “That means the hopes of a quick recovery will be slimmer and slimmer.”

The fact that some of the industries hit hardest early in the recession made big gains in June is both good and bad news. Leisure and hospitality, which had lost a staggering 8.3 million jobs in March and April, built on its May gains to add 2.1 million more workers in June, an increase of nearly 21 percent month over month. Similarly, retail trade, which lost 2.4 million jobs in March and April, bounced back with about 740,000 new workers in June, a 5.4 percent increase month over month. And education and health services, another of the industries most affected (with 2.8 million total job losses in March and April), added 568,000 jobs in June, for a 2.6 percent gain month over month.

Overall, almost every major industry sector of the economy added jobs in June, with total private employment up by 4.3 percent since May. However, it is worth noting that despite better-than-expected jobs reports in both May and now June, total private employment is still down 10.2 percent relative to its pre-crisis level in February. Things are looking better, but there is still a lot of room for improvement.

And the hammer might fall yet again on sectors like leisure and hospitality, which includes the restaurant industry. Several states allowed restaurants and even bars and casinos to reopen at partial capacity in May and June — only to abruptly close them again when case counts started to spike. That means that some of the workers who finally got to return to their jobs as servers, bartenders or blackjack dealers might well be unemployed again in the July report.

That everything these days is in a state of flux complicates even the most seasoned experts’ ability to read the report. Erica Groshen, who served as BLS commissioner from 2013 to 2017, said it’s extremely difficult to isolate the impact of the many different forces that are churning underneath the report. “We’ve got all of these effects that are going at cross-purposes,” she said. “We have the ongoing effects of restrictions in place. We have the effects of some restrictions being lifted. And we have the deepening of the recession itself.” All of that, she said, makes it hard to assess exactly what’s happening under the surface — much less what will happen next.

And again, the gains have not been equally distributed throughout the population — another theme of this very unequal recession. Although the unemployment rate for women dropped at a faster rate (2.8 percentage points) than for men (1.6) in June, women still had a higher overall unemployment rate than men did. Likewise, the unemployment rate for white Americans dropped by 2.3 percentage points last month, while it only fell by 1.4 percent for Black Americans and 1.2 percentage points for Asian Americans. And at 15.4 percent, Black Americans still have the highest unemployment rate of any racial or ethnic group, 5.3 percentage points higher than their white counterparts.

Perhaps one bit of encouraging data in this jobs report was that the unemployment rate for Latino or Hispanic Americans did drop by quite a bit — it was down 3.1 percentage points in June. However, that still left their overall unemployment rate at 14.5 percent, which is not only far higher than it was before the coronavirus recession began (it was 4.4 percent in February) but also higher than the unemployment rates for white (10.1 percent) or Asian (13.8 percent) Americans.

As we’ve said often during this crisis, you really need the next jobs report in order to interpret the current one. The June report shows that the unexpected employment gains of May were not a mirage — the economy really did start recovering earlier and more quickly than many economists expected. But next month’s report could be a sobering reminder of just how fragile any economic gains are — at least while the virus is still spiraling out of control in many parts of the country. So we’ll know better by next month whether the concerning trends in this report have deepened, as well as how much the recent COVID-19 outbreaks across the country have hamstrung the nascent recovery. In typical fashion, our economic data is moving at a much slower pace than the virus, which leaves us guessing at where things might head next.

[theliberaltony]

via Politics – FiveThirtyEight

Graphics by Anna Wiederkehr

Congress has less than a month to hammer out a deal on the next round of stimulus before expanded unemployment benefits expire. State and local governments are starting to feel the pinch of budget shortfalls. And while the U.S. got a piece of (relatively) good news in last week’s jobs report, which featured an unemployment rate 2.2 percentage points lower in June than it had been in May, the economy has been thrown back into chaos in the meantime, with a number of states pulling back on their reopenings amid spiking COVID-19 infections and hospitalizations.

Our newest survey of economists highlights just how consequential governmental decisions over the next month may be: On average, these economists think that a refusal by Congress to extend unemployment benefits or bail out state and local governments is just as likely to hurt the economy as local economies staying open in spite of COVID-19 spikes — or even closing because of the virus.

In partnership with the Initiative on Global Markets at the University of Chicago Booth School of Business, FiveThirtyEight asked 31 quantitative macroeconomic economists what they thought about a variety of subjects around the coronavirus recession and recovery efforts. The most recent survey was conducted from July 2 through 6, which means the June jobs report was fresh on respondents’ minds — but so was the state of the pandemic, along with challenges ahead for lawmakers.

“There’s a distinct risk that between now and November, Congress’s ability to continue fiscal support will be very limited by election-year politics,” said Jonathan Wright, an economics professor at Johns Hopkins University who has been consulting with us on the design of the survey. “That could be more of a drag on the economy than the local and state shutdowns just because the effect would be so huge.”

With a congressional showdown looming, we asked the experts to estimate the probability that several policy decisions would have the biggest negative impact on U.S. gross domestic product in the fourth quarter of 2020. Among the five options we presented, the single most important to the economists was a decision by state and local governments to reclose their economies because of COVID-19 outbreaks. But a decision by Congress not to provide funding to state and local governments was close behind. And the weight given to choices made by the federal government — bailing out local governments, extending unemployment insurance and providing ongoing aid for small businesses — added up to be even more important when taken as a whole:

What are the biggest economic risk factors by year’s end?

Average probabilities that each scenario would have the largest negative impact on U.S. GDP in the fourth quarter, according to economists

Local or state response options Avg. Probability Decision to reverse local economic openings due to COVID-19 spikes 26% Decision to keep local economies open despite COVID-19 spikes 17 Total 43 Federal response options Not providing funding for state and local governments* 23% Ending/reducing expansion of unemployment benefits 20 Ending/cutting back on aid to small businesses 14 Total 57

* Funding to address budget shortfalls associated with COVID-19.

The survey of 31 economists was conducted July 2-6.

Source: FIVETHIRTYEIGHT/IGM COVID-19 ECONOMIC SURVEY

“[State and local governments] are facing severe budget crises and will be laying off workers to balance their budgets,” said Julie Smith, a professor of economics at Lafayette College. That, she said, could lead to longer periods of high unemployment and financial pain for many households. Meanwhile, she added, cutting back or ending the federal unemployment extension would cause many people’s incomes to decline dramatically, leaving them with much less money to spend — which could make a big dent in GDP.

Perhaps for this reason, there’s a lot of uncertainty in the economists’ fourth-quarter real GDP predictions. When we last asked the panel for its forecast, it thought that GDP would be growing by 4.1 percent at the end of the year, a big improvement from the -28.2 percent quarter-over-quarter annualized growth it foresaw for the second quarter of 2020. This time around, the panel is calling for less negative growth (-25.5 percent) in the second quarter and a very similar fourth-quarter growth rate to last time (3.8 percent). But the range around that end-of-year forecast has gotten a lot wider — a sign of just how much things could go wrong. The gap between our consensus forecast’s 10th and 90th percentile predictions for fourth-quarter GDP growth was 10.9 percentage points in the last survey; now that gap is 12.8 percentage points, with almost all of the extra uncertainty coming in the form of downside risk. (The panel’s consensus 10th percentile GDP growth forecast has dropped from -2.0 percent to -3.5 percent.)

The economists weren’t especially optimistic about the trajectory of the unemployment rate over the course of 2020, either. The consensus prediction was that the unemployment rate in December would be 10.1 percent, which is only 1 percentage point lower than the rate in June — and is still comparable to the unemployment rate at the height of the Great Recession. Stephen Cecchetti, a professor of international finance at the Brandeis International Business School, pointed out that workers are increasingly likely to be losing their jobs permanently, rather than temporarily, which will make it harder for them to get back into the labor force. And he added that it will take time for the economy to adjust to a new reality where working from home is the norm, which could also keep the unemployment rate from falling quickly. Cecchetti was also among the economists who thought that in a worst-case scenario, the unemployment rate could skyrocket again by the end of the year.

“There are a lot of people who haven’t been exposed to the virus,” he said. “It’s not hard to imagine new outbreaks in places like New Jersey or Massachusetts that force us to shut down all over again.”

About half of the economists in the survey also thought the country’s top earners would end the year with an even greater share of the nation’s personal income. In order to get a sense of how much the panel thought the COVID-19 recession would increase income inequality, we asked about a new metric created by the Bureau of Economic Analysis, which found that in 2016, households in the top 10 percent of incomes (adjusted for household size) accounted for 37.6 percent of the country’s personal income. Fifty percent of the respondents thought this number would be significantly higher by the end of 2020 as a result of the COVID-19 pandemic, while 47 percent thought it would be about the same. Only one respondent thought it would be lower.

“My best guess is that this pandemic is going to worsen income inequalities,” said Sarah Zubairy, a professor of economics at Texas A&M University. She hypothesized that this was because job loss has been concentrated among lower-wage workers who can’t do their jobs remotely, and who may find themselves ricocheting in and out of the labor force if states have to abruptly pull back their reopening plans.

And in another sign that the U.S. has been knocked off course by the virus — and the subsequent leadership response — our survey panel overwhelmingly believes (with 90 percent agreement) that China will beat both America and the European Union on the road back to pre-crisis real GDP levels. In retrospect, according to Wright, this was kind of a “no-brainer” because China’s economic growth so far has been quite swift, and it has tools to enact sweeping fiscal stimulus that aren’t available to less centrally controlled economies like the U.S. or the E.U. But some of this might also be based on the Chinese government’s reputation for — how should we put this? — releasing overly favorable public data. “When all is said and done, if they don’t like the actual data they can fudge the numbers,” Wright said. “Put those three things together, and there’s almost no way they can’t be the first back.”

Wright also pointed to another ominous result in the survey: 19 percent of respondents thought that the 10-year average real U.S. GDP growth rate would be reduced by 1 to 2 percent per year. To be sure, the vast majority (77 percent) of economists thought the 10-year average growth rate would be reduced by less, although only one person thought it would go up. But the responses were still alarming, Wright said, because they indicated a serious degree of pessimism about the speed with which the economy will not just return to where it was at the end of 2019, but also catch up with where it would have been if the COVID-19 pandemic hadn’t happened.

However, Allan Timmermann, professor of finance and economics at the University of California, San Diego — who has also been consulting with us on the survey — was encouraged that the majority of respondents didn’t expect more long-term damage to growth. “This is still a large impact in terms of its cumulative effect on the economy,” he wrote in an email. “But it does suggest that most respondents think the economy will bounce back in due course — as opposed to leading us to a ‘lost decade’ scenario (as we have seen in Japan) with growth slowing down by an even larger amount.”

Overall, though, the latest survey responses paint a picture of America’s still-precarious road back to economic health. So much depends on the course of COVID-19 itself and how much the virus forces local economies to shut down again to slow its spread. But a lot is also riding on important policy decisions around the virus, which are still being debated. “I think economists have been surprised so far by the pace of the rebound,” Wright said. “But that hasn’t made them less worried about the weeks or months ahead.”

[theliberaltony]

via Politics – FiveThirtyEight

Graphics by Anna Wiederkehr

As states push forward in their phased reopenings, we’re getting clues that the beleaguered U.S economy might be on its way to recovery. Retail sales spiked by 17.7 percent in May, and the unemployment rate unexpectedly dropped in that month as well — suggesting that Americans were returning to work and opening their wallets earlier than many expected. But experts still think that even if things are starting to look up now, we shouldn’t assume we’ll be back to normal anytime soon. In fact, economists think there are still significant economic risks despite the tentative rebound, including a second wave of COVID-19, an unwillingness to spend from consumers and an absence of an additional fiscal stimulus from Congress.

In partnership with the Initiative on Global Markets at the University of Chicago Booth School of Business, FiveThirtyEight asked 34 quantitative macroeconomic economists what they thought about a variety of subjects around the coronavirus recession and recovery efforts. The most recent survey, which was conducted from June 19 through 22, echoed many of the predictions from the last round — though there were also a few new wrinkles in their forecasts.

When we first asked about the shape of the recovery, 58 percent of respondents thought the trajectory of future U.S. gross domestic product looked like a Nike “swoosh” — a sharp downturn followed by a long, slow recovery. This time around, however, a consensus has formed around a slightly different shape: a reverse radical (i.e., a mirrored version of the square-root symbol).

This shape — which 73 percent of our economists predicted for the country’s economic future — implies a steep drop followed by a quick partial recovery and a longer period of slower, mixed growth. But it isn’t necessarily an improvement over the swoosh. “There is nothing standard or smooth about this recovery,” said Lisa Cook, professor of economics and international relations at Michigan State University. In her view, a reverse-radical-shaped recovery could be shaped by a spike in infections and hospitalizations, a wave of bankruptcies as unemployment benefits expire or consumers’ unwillingness to return to gyms, nail salons or other parts of their routine. That could make the bounce back from this recession bumpier than previous recessions.

Twelve of the 17 economists who had predicted a swoosh in our survey in late May changed to the reverse radical this time, leaving just five respondents sticking with the swoosh in this round of the survey. (And no economist switched to the swoosh, another sign that other patterns fit the trajectory of this economic recovery better.)

“By now, the partial reopening of the economy, along with the new unemployment and retail sales numbers, suggest a substantial bounce-back effect for the economy,” said Allan Timmermann, professor of finance and economics at the University of California, San Diego, who has been consulting with us on the design of the survey. “However, our panel is not convinced that this recovery will last, since they did not opt for the V-shaped recovery — in fact, it is interesting that not a single person opted for the V-shape.”

Overall, the surveyed group didn’t meaningfully budge on its projections for either GDP or unemployment from the last time we asked. Nor did it change its long-term timeline for when GDP might return to its pre-coronavirus benchmark. Maybe it’s encouraging that the projections haven’t gotten worse — but the panelists still think it’s unlikely (33 percent probability) that GDP will creep back up to where it was in the fourth quarter of 2019 any time before the first half of 2022.

Outlook on the GDP hasn’t improved since early June

Consensus forecasts for when U.S. gross domestic product will return to its pre-coronavirus level, in each round of the survey

Probability TIME FRAME Rd. 1 (May 25) Rd. 2 (June 8) Rd. 3 (June 22) First half of 2021 or earlier 11% 10% 11% Second half of 2021 18 21 22 First half of 2022 18 23 22 Second half of 2022 21 22 22 Later than the second half of 2022 33 25 24

Probabilities are based on the average of the 28 economists who answered this question in all three surveys.

Source: FIVETHIRTYEIGHT/IGM COVID-19 ECONOMIC outlook SURVEY

In a new question this round, we asked respondents what factors might bring about their worst-case predictions for fourth-quarter GDP growth. Perhaps unsurprisingly, the average participant gave the most weight to the possibility of a second wave of coronavirus later in the year. But their next-most-significant fears were economic in nature: whether consumers would be unwilling to spend even after businesses open and whether Congress would choose not to pass further economic stimulus packages:

What might cause a worst-case scenario?

How much weight economists gave various scenarios when setting the lower bound of their GDP predictions for the fourth quarter of 2020

Factor Weight A bad “second wave” of coronavirus in the summer or fall 41.6% Public aversion to consumer spending even after businesses reopen 20.4 Decision by policymakers not to pass further fiscal stimulus 19.0 Weakness in the banking or financial system 9.7 Slower-than-expected development of a coronavirus vaccine 7.9 Other 1.3

Weights are an average of responses in a survey of 34 economists conducted June 19-22.

Source: FIVETHIRTYEIGHT/IGM COVID-19 ECONOMIC OUTLOOK SURVEY

We also cannot understate the weirdness of these economic times. This led to a few other noteworthy results in our survey, starting with very high projections for the personal saving rate, which ballooned to a record 33 percent in April. (In that metric, saving is expressed as a share of disposable personal income.) Our group of economists doesn’t think it will stay quite that high going forward, but the respondents did predict a mean saving rate of 20.2 percent in June1 with an 80 percent confidence interval ranging from 13 percent on the low end to nearly 29 percent on the high side. To put that in context: According to data going back to 1959 from the Federal Reserve Bank of St. Louis, the U.S. personal saving rate had never been higher than 17.3 percent before the coronavirus and had seldom gone into the double digits since the early 1990s.

Gloria Gonzalez-Rivera, a professor of economics at the University of California, Riverside, told us that she didn’t think the June saving rate would match April’s simply because Americans had fewer opportunities to spend their money at the height of the state-level lockdowns. But she added that she still expected consumers to be “conservative” in June.

“A high savings rate is a sign that consumer confidence is low and spending is going to be low,” said Jonathan Wright, an economics professor at Johns Hopkins University who, along with Timmermann, has been guiding the design of the survey. “My spending is someone else’s income. So when people start to save a lot, that really slows down the recovery.”

The unusual nature of this recession also showed up in our respondents’ prediction for which investments might deliver the highest return over the rest of the year. As we wrote about last week, the stock market has been busy regaining most of its initial coronavirus-related losses since late March, even as the rest of the economy sits in a very tenuous place. Our panel generally thinks that disconnect between the stock market and the broader economy will continue. When given the choice among three investments, the panelists thought there was a 45 percent chance that NASDAQ — with its heavy emphasis on tech stocks — would perform best, followed by the S&P 500 at 34 percent. The economists thought there was just a 21 percent chance that 10-year U.S Treasury bonds, traditionally a safe haven in an environment of uncertainty and low corporate earnings, would provide the highest rate of return by the end of 2020.

Overall, the economists in our survey think the economy has a long way to go before it returns to normal. Much of its path from here will hinge on the state of the virus itself, with additional emphasis on the government’s response. But the panel also sees many of the stranger features of this particular recession continuing to some degree — from the stock market’s disconnect with the rest of the economy to the extraordinary levels of personal savings by Americans. And of course, the error bars around the forecasts remain wide — as befits one of the most unpredictable economic moments in recent history.

[kristinsimmons]

Take Your Mom to Work

By KIM BELLARD

If you are a working mom, or married to one, or simply know one, you know that it is tough to balance a job and raising a child even under ideal circumstances.  Even if she has a supportive spouse, chances are that it is the mom who ends up providing the most child care, and whose career it impacts the most.

But, of course, these are not ideal circumstances.  Prior to the pandemic, women had made great strides in the workforce; more women had payroll jobs than men, for example (although they continued to be paid less for them).  Those gains quickly came crashing down once the pandemic hit.  It is believed to be the first time that job and incomes losses have hit women harder than men.  Some are calling our pandemic-driven economic downturn a “shecession” as a result.   

That’s bad enough, but the even bigger danger is that the pandemic could set back women’s careers for a generation. 

A recent study by Collins, et. alia confirmed what most might have guessed: in the wake of the pandemic, women are more likely than men to have reduced their work hours to take on additional child care responsibilities due to school/daycare closing — four or five times as much.  

The study found that:

Scaling back work is part of a downward spiral that often leads to labor force exits—especially in cases where employers are inflexible with schedules or penalize employees unable to meet work expectations in the face of growing care demands.  

We are also concerned that many employers will be looking for ways to save money and it may be at the expense of mothers who have already weakened their labor market attachment.

Even more worrying, lead author Caitlyn Collins, a professor at Washington University, says: “Our findings indicate mothers are bearing the brunt of the pandemic and may face long-term employment penalties as a consequence.”  

Five-Thirty-Eight’s Neil Paine and Amelia Thomson-DeVeaux analyzed how the pandemic could “force an entire generation out of the workforce.”  It starts with availability of child care, as shown in this chart:

Combine that with uncertainty about schools reopening and it makes child care decisions extremely tough.  Women with young children were already less likely to be in the workforce than other women, they point out, with caregiving cited as a major reason, and the pandemic is exacerbating the effect.  “Leaving the workforce,” they note, “even if it’s just for a year or two, has ripple effects that can follow a woman for the rest of her life, even depressing her earnings in retirement.”  

“We’re in danger of erasing the limited gains we’ve made for women over the past few decades, and especially women of color,” Melissa Boteach of the National Women’s Law Center told them.  

Trying to get the economy open again without figuring out how we’re going to support working moms is a “recipe for a generational wipeout of mothers’ careers,” Joan Williams, University of California Hastings College of Law and founder of the Center for WorkLife Law, told The Wall Street Journal.  

The WSJ article cites a Boston Consulting Group survey from this spring that found that both men and women were spending more time on domestic chores than pre-pandemic, but that the gap between women and men had increased from 10 hours per week to 15 hours.  “That’s almost two days more of a secondary job,” Matt Krentz, a managing director at BCG told WSJ. “When the trade off comes and it’s not sustainable, the solution often falls to the woman taking the step back.”

The article notes: “People who drop out of the labor force for an extended period not only miss out on pay, they also often fall behind on raises that come from longer tenure and employer contributions to retirement accounts.”  When you see “people,” read “women.”

Betsy Stevenson, a University of Michigan professor of economics and public policy, told The New York Times, “We could have an entire generation of women who are hurt.  They may spend a significant amount of time out of the work force, or their careers could just peter out in terms of promotions.”  

Professor Stevenson summed up what may be the core issue: “This pandemic has exposed some weaknesses in American society that were always there, and one of them is the incomplete transition of women into truly equal roles in the labor market.”

Deb Perelman, writing in The New York Times, puts the dilemma succinctly:  “In the Covid-19 economy, you’re allowed only a kid or a job.”  She goes on to add:

The long-term losses for professional adults will be incalculable, too, and will disproportionately affect mothers. Working mothers all over the country feel that they’re being pushed out of the labor force or into part-time jobs as their responsibilities at home have increased tenfold.

It’s outrageous, Ms. Perelman believes, and she wonders: 

“Why isn’t anyone talking about this? Why are we not hearing a primal scream so deafening that no plodding policy can be implemented without addressing the people buried by it?”

Why, indeed.  

In an op-ed in The New York Times, Professor Williams asserted: 

We’re in this mess because, even before coronavirus, the legal protections for working mothers consisted of a convoluted matrix of federal, state and local laws…The lack of straightforward legal protections is just one of many ways that public policy fails mothers; the haphazard nature of Families First is merely one symptom of a broader problem.

As The New York Times noted: “In countries that offer more comprehensive support for families — like Germany, France, Canada and Sweden — a significantly larger proportion of women are in the labor force.”   

This is, of course, an issue of particular importance to healthcare. According to the Census Bureau, women make up 76% of the healthcare labor force. Child care considerations may drive much of the gender imbalances by specialty for women physicians and other healthcare workers. When COVID-19 hit, essential healthcare workers struggled to find child care that allowed them to keep working. These factors shape our healthcare workforce and our healthcare system.

It’s hard to picture now, but the pandemic will eventually pass.  Perhaps we’ll get a vaccine, perhaps it will have to run its course through the population.  Most, but not all, jobs will come back; the economy will improve.  We’ll settle into a new normal.  All that will cost trillions of dollars, hardships for millions, and way, way too many lives.  

Most of the damage, though, will be measured in months or years — not generations.  Unless we proactively take action, though, these impacts on women’s careers can be generational.  The pandemic may galvanize action on, for example, unemployment programs/systems and our healthcare system.  We need that same will to action on supporting working moms, such as through better family leave and child care policies.

Do it for your mom. 

Kim is a former emarketing exec at a major Blues plan, editor of the late & lamented Tincture.io, and now regular THCB contributor.

Take Your Mom to Work published first on https://wittooth.tumblr.com/

[kristinsimmons]

Take Your Mom to Work

By KIM BELLARD

If you are a working mom, or married to one, or simply know one, you know that it is tough to balance a job and raising a child even under ideal circumstances.  Even if she has a supportive spouse, chances are that it is the mom who ends up providing the most child care, and whose career it impacts the most.

But, of course, these are not ideal circumstances.  Prior to the pandemic, women had made great strides in the workforce; more women had payroll jobs than men, for example (although they continued to be paid less for them).  Those gains quickly came crashing down once the pandemic hit.  It is believed to be the first time that job and incomes losses have hit women harder than men.  Some are calling our pandemic-driven economic downturn a “shecession” as a result.   

That’s bad enough, but the even bigger danger is that the pandemic could set back women’s careers for a generation. 

A recent study by Collins, et. alia confirmed what most might have guessed: in the wake of the pandemic, women are more likely than men to have reduced their work hours to take on additional child care responsibilities due to school/daycare closing — four or five times as much.  

The study found that:

Scaling back work is part of a downward spiral that often leads to labor force exits—especially in cases where employers are inflexible with schedules or penalize employees unable to meet work expectations in the face of growing care demands.  

We are also concerned that many employers will be looking for ways to save money and it may be at the expense of mothers who have already weakened their labor market attachment.

Even more worrying, lead author Caitlyn Collins, a professor at Washington University, says: “Our findings indicate mothers are bearing the brunt of the pandemic and may face long-term employment penalties as a consequence.”  

Five-Thirty-Eight’s Neil Paine and Amelia Thomson-DeVeaux analyzed how the pandemic could “force an entire generation out of the workforce.”  It starts with availability of child care, as shown in this chart:

Combine that with uncertainty about schools reopening and it makes child care decisions extremely tough.  Women with young children were already less likely to be in the workforce than other women, they point out, with caregiving cited as a major reason, and the pandemic is exacerbating the effect.  “Leaving the workforce,” they note, “even if it’s just for a year or two, has ripple effects that can follow a woman for the rest of her life, even depressing her earnings in retirement.”  

“We’re in danger of erasing the limited gains we’ve made for women over the past few decades, and especially women of color,” Melissa Boteach of the National Women’s Law Center told them.  

Trying to get the economy open again without figuring out how we’re going to support working moms is a “recipe for a generational wipeout of mothers’ careers,” Joan Williams, University of California Hastings College of Law and founder of the Center for WorkLife Law, told The Wall Street Journal.  

The WSJ article cites a Boston Consulting Group survey from this spring that found that both men and women were spending more time on domestic chores than pre-pandemic, but that the gap between women and men had increased from 10 hours per week to 15 hours.  “That’s almost two days more of a secondary job,” Matt Krentz, a managing director at BCG told WSJ. “When the trade off comes and it’s not sustainable, the solution often falls to the woman taking the step back.”

The article notes: “People who drop out of the labor force for an extended period not only miss out on pay, they also often fall behind on raises that come from longer tenure and employer contributions to retirement accounts.”  When you see “people,” read “women.”

Betsy Stevenson, a University of Michigan professor of economics and public policy, told The New York Times, “We could have an entire generation of women who are hurt.  They may spend a significant amount of time out of the work force, or their careers could just peter out in terms of promotions.”  

Professor Stevenson summed up what may be the core issue: “This pandemic has exposed some weaknesses in American society that were always there, and one of them is the incomplete transition of women into truly equal roles in the labor market.”

Deb Perelman, writing in The New York Times, puts the dilemma succinctly:  “In the Covid-19 economy, you’re allowed only a kid or a job.”  She goes on to add:

The long-term losses for professional adults will be incalculable, too, and will disproportionately affect mothers. Working mothers all over the country feel that they’re being pushed out of the labor force or into part-time jobs as their responsibilities at home have increased tenfold.

It’s outrageous, Ms. Perelman believes, and she wonders: 

“Why isn’t anyone talking about this? Why are we not hearing a primal scream so deafening that no plodding policy can be implemented without addressing the people buried by it?”

Why, indeed.  

In an op-ed in The New York Times, Professor Williams asserted: 

We’re in this mess because, even before coronavirus, the legal protections for working mothers consisted of a convoluted matrix of federal, state and local laws…The lack of straightforward legal protections is just one of many ways that public policy fails mothers; the haphazard nature of Families First is merely one symptom of a broader problem.

As The New York Times noted: “In countries that offer more comprehensive support for families — like Germany, France, Canada and Sweden — a significantly larger proportion of women are in the labor force.”   

This is, of course, an issue of particular importance to healthcare. According to the Census Bureau, women make up 76% of the healthcare labor force. Child care considerations may drive much of the gender imbalances by specialty for women physicians and other healthcare workers. When COVID-19 hit, essential healthcare workers struggled to find child care that allowed them to keep working. These factors shape our healthcare workforce and our healthcare system.

It’s hard to picture now, but the pandemic will eventually pass.  Perhaps we’ll get a vaccine, perhaps it will have to run its course through the population.  Most, but not all, jobs will come back; the economy will improve.  We’ll settle into a new normal.  All that will cost trillions of dollars, hardships for millions, and way, way too many lives.  

Most of the damage, though, will be measured in months or years — not generations.  Unless we proactively take action, though, these impacts on women’s careers can be generational.  The pandemic may galvanize action on, for example, unemployment programs/systems and our healthcare system.  We need that same will to action on supporting working moms, such as through better family leave and child care policies.

Do it for your mom. 

Kim is a former emarketing exec at a major Blues plan, editor of the late & lamented Tincture.io, and now regular THCB contributor.

Take Your Mom to Work published first on https://wittooth.tumblr.com/

[lauramalchowblog]

Take Your Mom to Work

By KIM BELLARD

If you are a working mom, or married to one, or simply know one, you know that it is tough to balance a job and raising a child even under ideal circumstances.  Even if she has a supportive spouse, chances are that it is the mom who ends up providing the most child care, and whose career it impacts the most.

But, of course, these are not ideal circumstances.  Prior to the pandemic, women had made great strides in the workforce; more women had payroll jobs than men, for example (although they continued to be paid less for them).  Those gains quickly came crashing down once the pandemic hit.  It is believed to be the first time that job and incomes losses have hit women harder than men.  Some are calling our pandemic-driven economic downturn a “shecession” as a result.   

That’s bad enough, but the even bigger danger is that the pandemic could set back women’s careers for a generation. 

A recent study by Collins, et. alia confirmed what most might have guessed: in the wake of the pandemic, women are more likely than men to have reduced their work hours to take on additional child care responsibilities due to school/daycare closing — four or five times as much.  

The study found that:

Scaling back work is part of a downward spiral that often leads to labor force exits—especially in cases where employers are inflexible with schedules or penalize employees unable to meet work expectations in the face of growing care demands.  

We are also concerned that many employers will be looking for ways to save money and it may be at the expense of mothers who have already weakened their labor market attachment.

Even more worrying, lead author Caitlyn Collins, a professor at Washington University, says: “Our findings indicate mothers are bearing the brunt of the pandemic and may face long-term employment penalties as a consequence.”  

Five-Thirty-Eight’s Neil Paine and Amelia Thomson-DeVeaux analyzed how the pandemic could “force an entire generation out of the workforce.”  It starts with availability of child care, as shown in this chart:

Combine that with uncertainty about schools reopening and it makes child care decisions extremely tough.  Women with young children were already less likely to be in the workforce than other women, they point out, with caregiving cited as a major reason, and the pandemic is exacerbating the effect.  “Leaving the workforce,” they note, “even if it’s just for a year or two, has ripple effects that can follow a woman for the rest of her life, even depressing her earnings in retirement.”  

“We’re in danger of erasing the limited gains we’ve made for women over the past few decades, and especially women of color,” Melissa Boteach of the National Women’s Law Center told them.  

Trying to get the economy open again without figuring out how we’re going to support working moms is a “recipe for a generational wipeout of mothers’ careers,” Joan Williams, University of California Hastings College of Law and founder of the Center for WorkLife Law, told The Wall Street Journal.  

The WSJ article cites a Boston Consulting Group survey from this spring that found that both men and women were spending more time on domestic chores than pre-pandemic, but that the gap between women and men had increased from 10 hours per week to 15 hours.  “That’s almost two days more of a secondary job,” Matt Krentz, a managing director at BCG told WSJ. “When the trade off comes and it’s not sustainable, the solution often falls to the woman taking the step back.”

The article notes: “People who drop out of the labor force for an extended period not only miss out on pay, they also often fall behind on raises that come from longer tenure and employer contributions to retirement accounts.”  When you see “people,” read “women.”

Betsy Stevenson, a University of Michigan professor of economics and public policy, told The New York Times, “We could have an entire generation of women who are hurt.  They may spend a significant amount of time out of the work force, or their careers could just peter out in terms of promotions.”  

Professor Stevenson summed up what may be the core issue: “This pandemic has exposed some weaknesses in American society that were always there, and one of them is the incomplete transition of women into truly equal roles in the labor market.”

Deb Perelman, writing in The New York Times, puts the dilemma succinctly:  “In the Covid-19 economy, you’re allowed only a kid or a job.”  She goes on to add:

The long-term losses for professional adults will be incalculable, too, and will disproportionately affect mothers. Working mothers all over the country feel that they’re being pushed out of the labor force or into part-time jobs as their responsibilities at home have increased tenfold.

It’s outrageous, Ms. Perelman believes, and she wonders: 

“Why isn’t anyone talking about this? Why are we not hearing a primal scream so deafening that no plodding policy can be implemented without addressing the people buried by it?”

Why, indeed.  

In an op-ed in The New York Times, Professor Williams asserted: 

We’re in this mess because, even before coronavirus, the legal protections for working mothers consisted of a convoluted matrix of federal, state and local laws…The lack of straightforward legal protections is just one of many ways that public policy fails mothers; the haphazard nature of Families First is merely one symptom of a broader problem.

As The New York Times noted: “In countries that offer more comprehensive support for families — like Germany, France, Canada and Sweden — a significantly larger proportion of women are in the labor force.”   

This is, of course, an issue of particular importance to healthcare. According to the Census Bureau, women make up 76% of the healthcare labor force. Child care considerations may drive much of the gender imbalances by specialty for women physicians and other healthcare workers. When COVID-19 hit, essential healthcare workers struggled to find child care that allowed them to keep working. These factors shape our healthcare workforce and our healthcare system.

It’s hard to picture now, but the pandemic will eventually pass.  Perhaps we’ll get a vaccine, perhaps it will have to run its course through the population.  Most, but not all, jobs will come back; the economy will improve.  We’ll settle into a new normal.  All that will cost trillions of dollars, hardships for millions, and way, way too many lives.  

Most of the damage, though, will be measured in months or years — not generations.  Unless we proactively take action, though, these impacts on women’s careers can be generational.  The pandemic may galvanize action on, for example, unemployment programs/systems and our healthcare system.  We need that same will to action on supporting working moms, such as through better family leave and child care policies.

Do it for your mom. 

Kim is a former emarketing exec at a major Blues plan, editor of the late & lamented Tincture.io, and now regular THCB contributor.

Take Your Mom to Work published first on https://venabeahan.tumblr.com

[kristinsimmons]

Take Your Mom to Work

By KIM BELLARD

If you are a working mom, or married to one, or simply know one, you know that it is tough to balance a job and raising a child even under ideal circumstances.  Even if she has a supportive spouse, chances are that it is the mom who ends up providing the most child care, and whose career it impacts the most.

But, of course, these are not ideal circumstances.  Prior to the pandemic, women had made great strides in the workforce; more women had payroll jobs than men, for example (although they continued to be paid less for them).  Those gains quickly came crashing down once the pandemic hit.  It is believed to be the first time that job and incomes losses have hit women harder than men.  Some are calling our pandemic-driven economic downturn a “shecession” as a result.   

That’s bad enough, but the even bigger danger is that the pandemic could set back women’s careers for a generation. 

A recent study by Collins, et. alia confirmed what most might have guessed: in the wake of the pandemic, women are more likely than men to have reduced their work hours to take on additional child care responsibilities due to school/daycare closing — four or five times as much.  

The study found that:

Scaling back work is part of a downward spiral that often leads to labor force exits—especially in cases where employers are inflexible with schedules or penalize employees unable to meet work expectations in the face of growing care demands.  

We are also concerned that many employers will be looking for ways to save money and it may be at the expense of mothers who have already weakened their labor market attachment.

Even more worrying, lead author Caitlyn Collins, a professor at Washington University, says: “Our findings indicate mothers are bearing the brunt of the pandemic and may face long-term employment penalties as a consequence.”  

Five-Thirty-Eight’s Neil Paine and Amelia Thomson-DeVeaux analyzed how the pandemic could “force an entire generation out of the workforce.”  It starts with availability of child care, as shown in this chart:

Combine that with uncertainty about schools reopening and it makes child care decisions extremely tough.  Women with young children were already less likely to be in the workforce than other women, they point out, with caregiving cited as a major reason, and the pandemic is exacerbating the effect.  “Leaving the workforce,” they note, “even if it’s just for a year or two, has ripple effects that can follow a woman for the rest of her life, even depressing her earnings in retirement.”  

“We’re in danger of erasing the limited gains we’ve made for women over the past few decades, and especially women of color,” Melissa Boteach of the National Women’s Law Center told them.  

Trying to get the economy open again without figuring out how we’re going to support working moms is a “recipe for a generational wipeout of mothers’ careers,” Joan Williams, University of California Hastings College of Law and founder of the Center for WorkLife Law, told The Wall Street Journal.  

The WSJ article cites a Boston Consulting Group survey from this spring that found that both men and women were spending more time on domestic chores than pre-pandemic, but that the gap between women and men had increased from 10 hours per week to 15 hours.  “That’s almost two days more of a secondary job,” Matt Krentz, a managing director at BCG told WSJ. “When the trade off comes and it’s not sustainable, the solution often falls to the woman taking the step back.”

The article notes: “People who drop out of the labor force for an extended period not only miss out on pay, they also often fall behind on raises that come from longer tenure and employer contributions to retirement accounts.”  When you see “people,” read “women.”

Betsy Stevenson, a University of Michigan professor of economics and public policy, told The New York Times, “We could have an entire generation of women who are hurt.  They may spend a significant amount of time out of the work force, or their careers could just peter out in terms of promotions.”  

Professor Stevenson summed up what may be the core issue: “This pandemic has exposed some weaknesses in American society that were always there, and one of them is the incomplete transition of women into truly equal roles in the labor market.”

Deb Perelman, writing in The New York Times, puts the dilemma succinctly:  “In the Covid-19 economy, you’re allowed only a kid or a job.”  She goes on to add:

The long-term losses for professional adults will be incalculable, too, and will disproportionately affect mothers. Working mothers all over the country feel that they’re being pushed out of the labor force or into part-time jobs as their responsibilities at home have increased tenfold.

It’s outrageous, Ms. Perelman believes, and she wonders: 

“Why isn’t anyone talking about this? Why are we not hearing a primal scream so deafening that no plodding policy can be implemented without addressing the people buried by it?”

Why, indeed.  

In an op-ed in The New York Times, Professor Williams asserted: 

We’re in this mess because, even before coronavirus, the legal protections for working mothers consisted of a convoluted matrix of federal, state and local laws…The lack of straightforward legal protections is just one of many ways that public policy fails mothers; the haphazard nature of Families First is merely one symptom of a broader problem.

As The New York Times noted: “In countries that offer more comprehensive support for families — like Germany, France, Canada and Sweden — a significantly larger proportion of women are in the labor force.”   

This is, of course, an issue of particular importance to healthcare. According to the Census Bureau, women make up 76% of the healthcare labor force. Child care considerations may drive much of the gender imbalances by specialty for women physicians and other healthcare workers. When COVID-19 hit, essential healthcare workers struggled to find child care that allowed them to keep working. These factors shape our healthcare workforce and our healthcare system.

It’s hard to picture now, but the pandemic will eventually pass.  Perhaps we’ll get a vaccine, perhaps it will have to run its course through the population.  Most, but not all, jobs will come back; the economy will improve.  We’ll settle into a new normal.  All that will cost trillions of dollars, hardships for millions, and way, way too many lives.  

Most of the damage, though, will be measured in months or years — not generations.  Unless we proactively take action, though, these impacts on women’s careers can be generational.  The pandemic may galvanize action on, for example, unemployment programs/systems and our healthcare system.  We need that same will to action on supporting working moms, such as through better family leave and child care policies.

Do it for your mom. 

Kim is a former emarketing exec at a major Blues plan, editor of the late & lamented Tincture.io, and now regular THCB contributor.

Take Your Mom to Work published first on https://wittooth.tumblr.com/

[theliberaltony]

via Politics – FiveThirtyEight

For a newsroom like FiveThirtyEight’s, 2019 may as well been part of 2020. Such is the peril of covering electoral politics. But before 2020 actually arrives, we wanted to take a moment and remember some of our favorite features from the past year that the news cycle hasn’t rendered obsolete. There was a lot of good stuff! This isn’t a comprehensive list, but it’s a good place to start.

Politics

“Just because Republicans aren’t winning in cities doesn’t mean that no Republicans live there,” Rachael Dottle wrote earlier this year. Using historical vote data, she showed where every city’s Republican enclaves were, and which cities were the most politically segregated.

Clare Malone went home to Cleveland’s suburbs to examine how the 2016 election laid bare political differences among white Americans. Clare found that the fissures had been lying in wait for decades.

How do you measure a gerrymandered district? Ella Koeze and William Adler showed how math can help expose which districts have been manipulated along partisan lines.

Black politicians on the local level live different political lives than black politicians who want to be president. In August, Perry Bacon Jr. dug into why that is.

Acitivists who want to restrict access to abortion made some progress on the state level this year. Amelia Thomson-DeVeaux categorized hundreds of abortion restrictions to show why the anti-abortion movement is escalating.

Automatic voter registration is a recent hobbyhorse of progressive activists. But is it the panacea it’s made out to be? Nathaniel Rakich looked at what happened when 2.2 million people were automatically registered to vote.

We’re told over and over again that politicians need to appeal to centrist moderates if they hope to win nationally. But Lee Drutman’s analysis suggests that narrative isn’t true. The moderate middle is a myth.

Clare Malone spent weeks tailing former Vice President Joe Biden to understand a contradiction at the center of his presidential campaign: black voters provide a lot of his support, but one of his biggest vulnerabilities is his record on race.

Scott Olson / Getty Images

Speaking of Biden, it can sometimes seem like it’s tough to dislodge a primary front-runner. But Geoffrey Skelley chronicled all the other front-runners who haven’t won. The list is long.

Amelia Thomson-DeVeaux and Dan Cox wrote about one more way millennials are different than boomers: they’ve left religion behind, and they’re probably not coming back.

In the very first House vote on impeachment, to simply formalize the process, Perry Bacon Jr. identified the political faultlines that would define the inquiry into the Ukraine scandal. Hint: They had to do with partisanship.

Does it seem to you like President Trump’s job approval ratings hardly budge? Well, that’s true. But Geoffrey Skelley looked at how unusual Trump’s ratings are historically.

The number of women in the Democratic field this cycle is unprecedented. And we don’t have any research on how sexism might affect such a race. But that doesn’t mean we know nothing about sexism’s electoral impact — Amelia Thomson-DeVeaux and Meredith Conroy put together a link-heavy introduction to what we know already, and how that could influence the 2020 primary.

Sports

We try and find overlap between politics and sports wherever we can, but that doesn’t mean we’re always good at knowing which is which. Earlier this year Tony Chow quizzed us on whether color commentary happened after a game or after a Democratic primary debate.

“Space Jam 2” is coming, and we’re hoping to be LeBron James’s casting director. We used our NBA metrics to cast the true successors to the cast of the original “Space Jam” movie.

It’s always tough to measure how good a defender is in the NFL. But Michael Chiang figured out a clever new way: look at where opposing offenses aren’t throwing.

JEAN WEI

How many clichés are in your average college fight song? We tried to figure out the answer.

Chris Herring attempted to solve one of the great mysteries of the NBA: “Why are there so many bats at Spurs games?”

Another big mystery: How do you accurately evaluate college quarterbacks for the pro game? Josh Hermseyer looks at how the NFL does it (poorly), and offers some alternative solutions.

EMILY SCHERER / GETTY IMAGES

Some people watch the Super Bowl for the football, and some people watch it for the halftime show. Gus Wezerek belongs to the latter, and he used data to rank 25 years of Super Bowl halftime shows.

How national is your college football team’s fanbase? And why is a random county in South Dakota buying so many USC tickets?

MLB commissioner Rob Manfred has been on a warpath against the parts of baseball he thinks are slowing down the game. Travis Sawchik found a culprit Manfred hasn’t targeted: foul balls.

It’s still relatively early in the 2019-20 NBA season, but the pairing of LeBron James and Anthony Davis on the Los Angeles Lakers has been really good. Actually, Neil Paine found that it’s been historically great.

We put Nate Silver in a dinosaur costume.

Other gems

SONNIE KOZLOVER

Most personality quizzes on the internet are bunk. This one is backed by science.

Conspiracy theories permeate our politics and culture. But get used to them. Maggie Koerth wrote that they can’t be stopped.

We publish a lot of forecasts here at FiveThirtyEight. But are they any good? Jay Boice and Gus Wezerek collected virtually every forecast FiveThirtyEight has ever done to find out. The short answer: Yes, they’re pretty good.

Christie Aschwanden had simple advice for those who work out: you don’t need sports drinks to stay hydrated.

[theliberaltony]

via Politics – FiveThirtyEight

We already knew the economic crisis of the coronavirus pandemic was moving much faster than our economic data could keep up with. But the most recent jobs report, which was released today, underscores just how little we know about the current state of the job market at any given moment. In a surprise development, the government’s data shows that 2.5 million more people were employed in May than in April. The unemployment rate, which had climbed to a stunning 14.7 percent in April, dropped to 13.3 percent in May. That’s a huge shock, to put it mildly: Forecasters had predicted that the report would show nearly 1 in 5 Americans out of work and millions more jobs lost.

Although experts told us that we’ll have to wait for the next report to get a sense of where the economy is truly heading, it’s clear that employment in some of the hardest-hit sectors started to recover last month. Almost 50 percent of the job gains for the entire economy were in the leisure and hospitality sector, which had cratered in March and April. This suggests that government efforts may have protected jobs — particularly through the Paycheck Protection Program (PPP), which allowed small businesses to receive forgivable loans if they spent the money on direct expenses like payroll — and that the first few weeks of states’ reopening allowed some workers to return to their jobs.

But this report isn’t all good news: Not only is a 13 percent unemployment rate extremely high by historical standards — for context, it hit a peak of 10 percent during the Great Recession — but also, the recovery doesn’t seem to have arrived for all workers. The unemployment rate fell for both men and women, which is noteworthy because women experienced more job losses during the first few months of the pandemic. But the unemployment rate for black workers (and particularly black women) actually rose from April to May — further exacerbating the racial disparities in which workers are out of a job. The trends aren’t as catastrophic as many expected, but the state of the labor market is still very grim.

Even though the monthly jobs report is one of the most accurate and comprehensive sources of economic data we have, it’s always a single snapshot of a moment in time — one that, in this case more than most, is rapidly disappearing in the rearview mirror. The May report is based on surveys of businesses and households from the middle of the month, before many states started to reopen and protests against police violence began to roil the country. So things could change even more in the next report — and it’s more difficult to predict in which direction.

“This almost feels like a quantum report — in the sense that it’s really hard to interpret this report without knowing the one after it,” said Nick Bunker, the director of economic research for North America at the Indeed Hiring Lab, a research institute connected to the job-search site Indeed. “It looks like the partial rebound that people were expecting a few months from now got here early. But we have no idea how this will continue. Is this what the whole recovery is going to be like? Do we go from a jump to a crawl?”

This report saw huge gains in some of the sectors of the economy where job losses were most concentrated in March and April — areas that were unable to continue to operate because of the pandemic, such as hospitality, education and health services, and retail trade. The leisure and hospitality supersector gained a total of 1.2 million jobs in May, the vast majority of which fall under food services and drinking places. Health care and social assistance saw a gain of 391,000 jobs, with dental offices making up 245,000 of those. And in retail, 368,000 jobs were added, with the biggest gains coming in clothing and accessories stores and general merchandise stores.

A notable takeaway from last month’s jobs report was the impact of the coronavirus recession across many different industries. Although leisure/hospitality continued to hemorrhage jobs in April, the effects of the pandemic were already rippling out to other sectors of the economy, such as local/state government, construction and health care. But in May, the trend of broad losses across the entire economy appears to have reversed itself. The diffusion index is an indicator that shows the share of private industries that added jobs, with an average score of 50. Last month’s index was revised to below 4 percent, meaning that almost no industries added workers. But this month, the index is 64 percent — meaning that many more sectors of the economy added jobs than lost them.

For instance, construction saw the second-biggest jobs increase for May among the major industries in the chart above, adding 464,000 workers — despite not being among the very hardest hit in March and April. That’s a sign that May’s gains are not coming only from workers returning to sectors that had seen the largest losses when the coronavirus first shook the economy.

It’s important to bear in mind that the headline jobs numbers are revised for accuracy in the following two jobs reports, so the total number of jobs gained or lost could change substantially in the coming months. The March number, which was initially reported as 701,000 jobs lost, was revised in the May 8 report to 881,000 lost jobs and to 1.4 million lost jobs in today’s report. But the revision for April’s payroll jobs number was smaller — from 20.5 million jobs lost to 20.7 million jobs lost. So it’s harder to predict what the revisions for May will look like, although Matt McDonald, a partner at the consulting firm Hamilton Place Strategies who writes a monthly analysis of the jobs report, told us in an email that he would be surprised, based on this month’s revisions, if it turned out that jobs were lost in May rather than gained.

One likely explanation for this sudden turnaround is that a significant number of small businesses started to get money from the federal government to bring their employees back to work. The program got off to a rocky start, with banks quickly running out of money and funds flowing first to parts of the country that were less affected by the pandemic. But according to a census survey conducted May 24-30, 80.6 percent of accommodation and food service small businesses had received PPP assistance, compared with an average across all sectors of 71 percent.

It’s also very possible that the handful of states that reopened in late April and early May made a difference. We won’t be able to dig into state-level information until a more granular set of data is released later this month, but McDonald told us that he expects big regional variations to show up.

The jobs gains might still seem at odds with the breathtaking number of Americans who have filed for unemployment over the past few months. Millions of Americans were still applying for payments last week, which was part of the reason that many forecasters expected the jobs report to be so bleak. But there were some signals even in these reports that the labor market might be improving. For one thing, continued claims — that is, the total number of people whose claims were paid out in a given week — finally started to decline during the week of May 16. And Bunker pointed out that, even though unemployment claims are reported more quickly than the figures in the monthly jobs report, those initial claims may not be a more accurate indicator of where the labor market stands, in part because there is a lot of variation in who is eligible for unemployment in different states and in how states report their data.

The slower decline in unemployment claims could also be due to the enormous delays in processing times that have been reported across the country, since workers can still receive unemployment payments for the time they spent off the job even if they returned to work in the meantime. Freelancers and independent contractors may also make up a significant chunk of the later claims — they were able to apply for unemployment insurance through a special, pandemic-specific program that rolled out in many states in late April and May.

There was evidence in this month’s jobs report that the small decline in the unemployment rate and uptick in payroll jobs were due to temporarily furloughed workers returning to their positions. According to the Bureau of Labor Statistics, the number of workers on temporary layoff dropped by 2.7 million in May, to 15.3 million. The bureau also reported that the number of unemployed people who were jobless for fewer than five weeks dropped to 3.9 million in May, a decrease of 10.4 million from April. (The number of people jobless for five or more weeks, meanwhile, increased by 8.8 million in May.) This may also speak to the backlog in processing unemployment insurance claims on a week-to-week basis, with many workers showing up in the claims data even if, in reality, they had already returned to work.

All of that might seem like good news — a sign that the economy will, in fact, be able to bounce back quickly as businesses start to reopen. That’s certainly how some policymakers interpreted it. Stephen Moore, a White House economic adviser, told reporters that the report removes the urgent need for another round of fiscal stimulus, which Democrats have been advocating for weeks.

But there’s plenty of bad news tucked into this report too — and several economists told us that just because the labor market data was less catastrophic than we had thought, it didn’t mean we should pump the brakes on government assistance to businesses or jobless workers. For one thing, it’s important not to lose sight of the fact that, again, a 13 percent unemployment rate is still stunningly high — and the researchers at the Bureau of Labor Statistics still think it may not be including some workers who said they were still employed but were absent from work during the entire week referenced in the survey. If those workers were included, the researchers wrote in the report, the unemployment rate would be 3 percentage points higher.

One of the biggest themes of the April jobs report was that the vast majority of the lost jobs (90 percent, excluding temporary jobs that were expected to be completed) were temporary layoffs. In May, that was still true — to an extent. Eighty-seven percent of job losses were still classified as temporary, though the number of permanent job losses increased by 295,000 from April to May.

Several economists told us they were especially focused on the nature of the layoffs in the May report because it’s an important indicator of how painful the recovery could be. “One of the things that’s been really unusual about this recession is how many temporary job losses we’ve had,” Bunker said. “The more permanent job losses we see, the more this will look like a normal recession, and that’s not good news because in the last two recessions, the recovery has been very stubborn and slow.” He said he was not encouraged by the fact that the number of permanent job losses had increased.

And while the coronavirus recession may have left tens of millions of workers jobless across the entire economy, it’s low-wage workers, workers of color and female workers who are continuing to bear the brunt of the job losses.

In April and May, the groups most disproportionately affected by job losses (relative to their share of the labor force) have been black and — especially — Hispanic workers. Despite making up 17.8 percent of the civilian labor force, Hispanic and Latino workers suffered 22.8 percent of the job losses in April and May. They have the highest unemployment rate of any ethnic group — 17.6 percent — and their rate has risen by a staggering 13.2 percentage points since February.

The unemployment rate among black Americans (16.8 percent) is significantly higher than the unemployment rate among white Americans (12.4 percent), too. Not only did unemployment among black workers start from a much higher point (5.8 percent in February, versus 3.1 percent for white workers), but it has also increased by more percentage points since before the coronavirus crisis (11 percentage points, versus 9.3 points for white workers). And while the unemployment rate for other racial groups fell in May, the black unemployment rate actually rose by 0.1 percentage points this past month, including by 0.6 points for black women.

Martha Gimbel, an economist with the philanthropic initiative Schmidt Futures, also pointed out that many black workers are still employed because they’re essential workers in low-wage jobs — which means they may be working under hazardous conditions where they’re more likely to be exposed to the virus, and they’re likely making less money than they would on unemployment.

Women also continue to be hit by job losses harder than men: 51.4 percent of total job losses since April have been women, even though they make up 47 percent of the civilian labor force.

A major factor is that women are more concentrated in the sectors that were disproportionately hit by job losses. In 2019, women made up 53 percent of workers in accommodation and food services, 70 percent of workers in educational services and 78 percent of workers in health care and social assistance. (They were also 82 percent of the workforce in dental offices.) Although all these areas of the economy saw a rebound in May, all have lost significant numbers of net jobs since the coronavirus crisis began.

Americans can be thankful that this month’s jobs report wasn’t as apocalyptic as many feared. But it’s premature to celebrate the dip in unemployment, even if it did defy expectations. “We shouldn’t let one month and one data point totally change how we’re thinking about the economy,” Gimbel said. “The level of unemployment is still really bad, even if the trends are starting to look more positive.”

And while there are signs of a recovery in the data, there is also plenty of evidence that the rebound did not reach all corners of the economy, particularly the most vulnerable ones. For now, the best grade anyone can give the job market is an incomplete — with even more emphasis placed on the next jobs report, which will speak volumes about how to interpret this one.