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The president’s allies are newly optimistic the brightening economic mood will further discredit the notion that a recession is necessary to tame inflation.

Despite the disagreement, senior White House aides still talk to Summers frequently and routinely seek his input. Summers has been to the White House several times this year alone, even as he continues to publicly hammer Biden’s industrial policy, student loan forgiveness and other economic programs.

Along with other centrist economists, Summers says inflation remains dangerously high, warning it could reaccelerate. The latest inflation report shows prices rising by 3.2 percent in July relative to one year ago, but a less volatile measure of price increases is still at 4.7 percent. The labor market remains strong not because Biden has defied the laws of economic reality, according to Summers, but because the battle against inflation is still far from won. Summers maintains the rescue plan sparked inflation that is at risk of becoming “entrenched” — a long-term problem for consumers and businesses.

“I don’t think anybody should reach any definitive judgments until we see how things play out,” Summers said in an interview. Summers said his predictions were based on standard macroeconomic models, and not meant to be interpreted as precise estimates. “The idea that bringing down inflation has nothing to do with increasing unemployment runs different from all conventional macroeconomic assessments.”

“The Democratic Party is currently split between people who thought the American Rescue Plan was appropriately sized and absolutely necessary — and those who think it was too big and had collateral effects that were quite damaging,” said Bill Galston, a policy analyst at the D.C.-based Brookings Institution who served in the Clinton administration. “This is a moral question, but it’s also a political question. If Joe Biden loses the election principally because of economic discontent over inflation and high prices, then a lot of Democrats will conclude it was not worth it.”

Summers has also made predictions that still do not appear to have been borne out, at least not yet. In a June 2022 speech at the London School of Economics, when inflation was at its 9.1 percent peak, Summers said the nation would “need” substantially higher levels of unemployment for inflation to come down.

In more recent interviews, Summers has defended his estimates by pointing out that inflation remains above the Fed’s 2 percent target. In particular, Summers emphasizes that it was always the case that transitory factors — such as soaring gas prices — pushed inflation up higher, to closer to 8 percent, but that the more stable “underlying” inflation was closer to 4.5 percent.

That same month, Summers and a co-author wrote that reducing job vacancies by 20 percent “requires, on average” a three percentage point increase in the unemployment rate. The number of job openings has fallen about 16 percent with no discernible jump in unemployment

In September 2022, Summers reiterated the point to Fortune: “I’m not sure you’re restraining inflation until you get the unemployment rate close to 5 percent, and to significantly restrain inflation you’re likely to need unemployment for some period at 6 percent.” The unemployment rate was 3.5 percent then and is the same level now.

“We need five years of unemployment above 5 percent to contain inflation — in other words, we need two years of 7.5 percent unemployment or five years of 6 percent unemployment or one year of 10 percent unemployment,

Even with lower overall inflation, Summers argues, underlying inflation remains largely unchanged — though the decline in transitory prices makes the problem appear to be going away.

“I think it’s fair to say — given how hot the economy is — the inflation performance at this point is better than I think many standard models would have predicted,” Summers said. “But I don’t think that all establishes we’re on a confident glide path to 2 percent with current rates of unemployment.”

More liberal economists argued that Summers misdiagnosed the cause of higher inflation, and therefore missed the cure. These economists contend that price spikes were overwhelmingly caused by supply chain disruptions, including lingering shocks from the pandemic and Russia’s invasion of Ukraine, not by too much government stimulus. As supply chains have normalized, so too has inflation.

Skanda Amarnath, executive director of the left-leaning think tank Employ America, emphasized that inflation is “now broadly decelerating,” not just in some idiosyncratic or transitory factors such as energy and used cars but across a large range of categories — household furnishings, technological equipment, wages, legal and professional services, and more.

“Remember when the experts said that to get inflation under control we needed to lower wages, and drive up unemployment? I never bought that,” Biden tweeted on July 20. “Instead, I focused on getting more Americans into the workforce, fixing our broken supply chains, and lowering costs.

Summers remains unconvinced about the rescue plan, pointing to substantial “unhappiness in the middle class about the state of the economy” over the last two years, mostly driven by inflation.

Economists said it was still too early to gauge the depth and length of the pandemic’s impact on the jobs market. Federal Reserve Bank of St Louis president James Bullard has said he expects unemployment to hit 30% in the second quarter, while Morgan Stanley has estimated that unemployment would average 12.8% over that time period.

Trump is concerned the quarantine measures could prove more harmful than the virus, an opinion that is disputed by economists and health experts.

According to Johns Hopkins University there are now 55,233 confirmed cases of Covid-19 in the US and 802 reported deaths, up from 302 last weekend. Despite the rising casualties, president Donald Trump said this week that he would like the country “opened up and just raring to go by Easter”.

A record 3.3 million people filed claims for unemployment in the US last week as the Covid-19 pandemic shut down large parts of America’s economy and the full scale of the impact of the crisis began to emerge.

The release offers the first official glimpse of the severe economic downturn that the US faces as companies shutter businesses and states across the country move to prevent people from gathering in crowds in an attempt to contain the virus.

Nearly every state cited the impact of Covid-19, the labor department said. Service industries broadly, particularly accommodation and food services, were hard hit although states also cited healthcare and social assistance, arts, entertainment and recreation, transportation and warehousing, and manufacturing industries.

Taylor Cox, a 29-year-old bartender from Indianapolis, was laid off 12 days ago. “People are scared, people don’t know what’s going to happen. The idea of a tipped worker going without tips for eight weeks or more is one of the most frightening things to have to confront,” told the Guardian.

Economists said it was still too early to gauge the depth and length of the pandemic’s impact on the jobs market. The Federal Reserve Bank of St Louis president, James Bullard, has said he expects unemployment to hit 30% in the second quarter, while Morgan Stanley has estimated that unemployment would average 12.8% over that time period.

3.5%, a 50-year-low, the black unemployment rate was 5.8%. The white unemployment rate was 3.1%.

“Whatever is being projected for the national unemployment rate, in most instances, we expect to see something close to twice that for black Americans.”

The reason why African Americans bear the brunt of downturns more is that when firing decisions start to occur the least educated and those with the least experience tend to be let go first. There is also continued discrimination in the workplace,” Rodgers said.

last hired, first fired” phenomenon dramatically affects black Americans more than any other group in the US due to the country’s history of racism and segregation of black Americans in the work sector.

Working in these fields leads to lower wages – black Americans have the lowest median wage of any racial group in the US – and the jobs are often seen as the most expendable during an economic downturn.

Even with a low unemployment rate, wage growth for low-wage workers, especially for black workers, has been slow. Black Americans have seen the slowest wage growth compared with other groups of Americans, reaching a growth rate that was four times slower at certain wage distribution levels, according to a 2018 Economic Policy Institute report.

For Yolanda Murray of Detroit, Michigan, not having savings meant weeks of panic trying to figure out how she was going to pay the bills that came on 1 April after she was furloughed from her job at a hotel.

t’s like how am I going to maintain all of this?” Murray said. Weeks after she filed her application for unemployment insurance, payments started coming in and Murray was able to pay her bills again.

Murray and her unionized co-workers spent 28 days striking for higher wages and better healthcare. At the time, workers at the hotel had not had wage rises since before the last recession, and healthcare costs were so expensive that Murray could only afford to cover herself, leaving her two children out of her plan.

Trump’s repeated claims that he has been the best president for African Americans was repeatedly pegged to falling unemployment numbers. But those numbers only tell a partial story, as work by Rodgers and others has shown. Black families are especially vulnerable to economic downturns because they lack the savings that can act as a buffer against unexpected layoffs or lost wages. And during the last recovery they lost ground against their white peers.

compared with 9%, respectively. And the black homeownership rate is the lowest of any racial group in the US and has consistently been about 30% lower than the white homeownership rate over the years, even as the economy was getting stronger.

“Wealth allows you to respond to that unexpected health emergency, that broken hole in the tire you have to replace. It also allows you to buy a home, put your kids through school,” said Danyelle Solomon, vice-president of the race and ethnicity program at the Center for American Progress.

Experts agree that being poor has costly effects on a person’s health: for adults living in extreme poverty, being poor can cost up to 15 years of life expectancy.

ave seen higher death rates due to Covid-19 compared with any other group in the US. Black Americans made up 25% of deaths from Covid-19 in the US though they make up a little under 13% of the US population.

“National emergencies, pandemics, epidemics, what they do is they spotlight inequality,” Solomon said. “What we see in Covid-19 is no different. It’s highlighting racial disparities at every single level that have been with our society for a very long time.”

Shierholz said despite the gloom, the federal government has the power and resources to intervene. “The economy is taking a big hit, but it is a policy choice, the level of human suffering that is caused,” Shierholz said.EPI is one of several bodies advocating for the federal government to waive unemployment insurance requirements, such as making people demonstrate they are looking for work; increase funding to social support systems, such as food stamps; place moratoriums on evictions; and allow laid off or furloughed people to continue using their employer-sponsored healthcare so state health insurance programs aren’t overwhelmed. Worker advocates are also encouraging employers to simply keep paying their employees, because when the crisis is over, those jobs will need to be filled again.

Early Wednesday, Congress reached a deal on what is expected to be the largest US economic stimulus measure ever passed.Democrats and Republicans had been divided on the level of oversight required for industries receiving bailouts. Progressives are concerned the Republican plan would allow billions of dollars to go to business leaders while workers continue to live without pay or health insurance.

The Brookings Institution thinktank said more than 24.2 million Americans work in the five high-risk sectors facing a sharp slowdown. This includes travel, hospitality, employment services, transportation and energy centers, such as Texas oil and gas towns.

More working people need to feel that hope, said Johnson. “This is like a wartime economy,” he said. The government needs to decide what its goals are “and get them done”.

But that is not the entire story. The euro zone’s troubles have helped Germany’s export-oriented economy. The weak euro has made Germany’s exports more competitive against those of countries with which it competes, most notably the United States and Japan. Since the end of 2007, the euro is down about 10 percent against the dollar and about 20 percent against the yen.

The charts reflecting Germany’s unemployment rates, if they were the only evidence available on world economic trends, would seem to indicate there was a mild downturn in 2009 that soon ended, with the economy recovering the next year. The United States charts would indicate a more severe downturn, followed by a recovery that began in 2010 and may now be gathering strength. In Britain, there has been much less progress since unemployment peaked in 2011.

In the 16 other euro zone countries as a group, the chart indicates a deep recession that leveled off in 2010 and 2011 but has since gotten much worse — particularly for young workers.

The European Commission’s latest economic forecast, released last week, predicted declining unemployment in Germany this year and next, but said joblessness was likely to continue to climb in France, Italy and Spain.

Cases in the United States now exceed 80,000, the most of any nation, even China and Italy, according to a New York Times database, and more than 1,000 deaths across the country have been linked to the virus.

President Trump said the federal government planned to designate areas as being at high, medium or low risk for spreading the virus to guide local decisions on imposing or relaxing restrictions on movement and commerce.

The terrifying speed of the U.S. economic collapse from the pandemic has spurred lawmakers to action. Late Wednesday night, senators agreed on a $2 trillion aid package that would provide cash payments to nearly all Americans and would expand the unemployment system, among other changes. Final congressional approval is expected on Friday.

A three-day rally has lifted stocks in the S&P 500 index more than 17 percent, including a rise of 6.2 percent on Thursday, though prices remain far lower than they were a month ago.

Some part-time and low-wage workers don’t qualify for unemployment benefits. Nor do gig workers, independent contractors and the self-employed, although the emergency aid package passed by the Senate would broaden eligibility to include many of them. Others who do qualify may not know it

The congressional relief package is intended to, in effect, press “pause” on the economy, allowing idled workers and shuttered businesses to keep paying their bills so that they can spring back quickly once the health crisis eases. If it works, the recovery could be relatively swift; if it doesn’t, the cascade of layoffs and business failures could stretch on far longer.

Low-wage workers — many of them black, like Ms. Moore-Caraway, or Hispanic — have been hit especially hard by the sudden economic reversal. Many work in the industries most affected by the outbreak, such as restaurants and travel, and few can work from home. They are also less likely to have sick leave or other paid time off, and they have less money saved to help overcome a missed paycheck.

Black and Hispanic workers “always bear the brunt” of economic slowdowns, said Alix Gould-Werth, a researcher at the Washington Center for Equitable Growth, a left-leaning think tank. “Now they’re bearing the brunt of these twin crises, the health crisis and the economic crisis.”

Under the congressional aid package, most families would receive $1,200 per adult and $500 per child in direct payments. The bill would also increase unemployment benefits by $600 a week and extend how long laid-off workers could receive benefits. And it would waive some requirements for receiving jobless benefits, like the requirement that recipients look for work.

An earlier relief bill, passed by Congress last week, provided $1 billion to help state unemployment systems that are breaking under the stress of record call volumes. Departments across the country reported huge spikes in call volumes and online applications.

About 82 percent of the Zillionaire Giveaway goes to those earning more than $1 million a year, according to Congress’s Joint Committee on Taxation. Of those beneficiaries earning more than $1 million annually, the average benefit is $1.6 million.

In other words, a single mom juggling two jobs gets a maximum $1,200 stimulus check — and then pays taxes so that a real estate mogul can receive $1.6 million.

polls suggest that they don’t appreciate the degree to which Trump and Congress also bungled the economic response — or manipulated it to benefit those who least need help.

The United States simply accepted that the pandemic would cause vast numbers of workers to be laid off — and then it provided unemployment benefits. But Germany, France, Britain, Denmark and other countries took the smarter path of paying companies to keep workers on their payrolls, thus preventing layoffs in the first place

So the unemployment rate in Germany and Denmark is forecast to reach about 5 percent while in the United States it may already be about 20 percent, depending on how you count it.

The United States did a little bit of this, but far less than Europe — yet the United States in some cases spent a larger share of G.D.P. on the bailout than Europe did.

t’s not fair to viruses to blame our unemployment crisis simply on the pandemic. It’s also our national choice.

At the same time, it has become increasingly clear that money intended to rescue small businesses has often gone not to those with the greatest need but rather to those with the most shameless lawyers.

For-profit colleges, which are better known for exploiting students than educating them, have raked in $1.1 billion.

AutoNation, a Fortune 500 company, received $77 million in small business funds

One provision in the rescue package provides a tax break that benefits only companies with more than $25 million in gross receipts

A new study determined that in the two months since March 18, roughly the start of the economic crisis, America’s billionaires saw their wealth collectively grow by 15 percent. And another 16 Americans became billionaires in that period.

Both forecasts, however, assumed that disinflation would require a substantial rise in unemployment. The professional forecasters predicted 4.4 percent unemployment by the fourth quarter, the Fed 4.6 percent. Since the actual unemployment rate in July was only 3.5 percent, to meet those predictions would require that the economy fall off a cliff starting just about now — and there are no signs that this is happening.

Getting inflation down, a chorus of economists insisted, would require much bigger increases in unemployment. Most famously, Larry Summers declared that we would need something like two years of 7.5 percent unemployment to get inflation down to 2 percent, but others offered broadly similar if less extreme diagnoses.

I’m still seeing a lot of excuses — two, in particular

One is the claim that much of the progress against inflation is in some sense illusory, that underlying inflation is still well above 4 percent

the preponderance of the evidence — plus the results of hands-free algorithms that use a consistent procedure to extract the signal from the noise — suggests underlying inflation around 3 percent and dropping.

The other is the claim that disinflation pessimists were simply applying standard economic models, so that the fault lay in the models, not themselves.

that’s simply not true. Standard models say that disinflation is very costly if persistent high inflation has become entrenched in expectations.

inflation pessimists really need to do what inflation optimists did a year ago, and ask how they got it so wrong, effectively calling for policies that would have put millions out of work.

it wasn’t partisanship; America’s right has become so divorced from empirical reality that it has played no role in this debate

What I do suspect, however, is that some very good economists got caught up in a version of the Very Serious People problem of the 2010s, in which the desire to seem hardheaded led many elite voices to obsess over budget deficits when they should have been focused on inadequate job creation.

The good news is that while the Fed did, in effect, try to engineer a recession to control inflation, it didn’t succeed: Despite rising interest rates, the economy just kept chugging along. Why that happened is another question. But pessimists really need to grapple with the fact that disinflation happened anyway.

This should be a wake-up call for a country that has spent decades mistreating, neglecting and radically underpaying its workers.

Consider: The US has not raised the federal minimum wage in more than a decade, and $7.25 an hour was a paltry sum even then. If today's minimum wage were commensurate with productivity increases over the last 50 years, it would be $22 an hour. Workers' purchasing power has been stagnant for 40 years, and even though workers are more productive than ever, their compensation has barely budged since the 1970s. Even more egregious is the minimum wage for tipped workers, which is an insulting $2.13 an hour, a number that hasn't gone up in 30 years.

Some employers say that they simply cannot afford to pay a living wage. But that failure should fall on the business, not on would-be employees. Businesses have been badly hurt by the pandemic, and while they've received some governmental support, it's been wildly inadequate. But even outside of pandemic times, workers were struggling, while too many businesses felt entitled to a steady supply of poorly-paid workers, often assigning them unpredictable and exhausting schedules that came along with inconsistent income. That is not a good or sustainable business model, and it's not one we should return to.

But it's likely not just too little pay keeping would-be workers from surging into the workforce -- there is also fear of illness (Covid still isn't over), lack of affordable childcare and a general recalibration of priorities and goals after a once-in-a-century pandemic. That recalibration is happening at every level, as white-collar employees push for greater workplace flexibility and their employers navigate how to structure the return to the office.

Nevertheless, many commentators have ignored this evidence. They conclude not only that there are widespread shortages, but that the culprit is pandemic unemployment insurance benefits. Governors in 25 Republican-led states have now said they will no longer accept federal unemployment benefits. This will cut aid to nearly four million impacted workers, despite the absence of compelling evidence that jobless benefits are causing problems in the labor market. Instead, we have considerable evidence that it is helpful.

But employers of low-wage workers typically have a great deal of power to suppress wages. Out of desperation, these workers often have no choice but to take any job no matter how bad the wages, unsafe the labor, or chaotic the schedule as they try to cobble together child care or elder care. Unemployment insurance isn’t keeping people out of the labor market en masse right now. But, when expanded benefits mean some individuals don’t feel the same pressure to accept a terrible job, that is what economists would call efficiency enhancing.

A more effective approach, experts say, would have raised unemployment insurance benefits to the jobless by $600 a week, matching the supplement under the stimulus package Congress passed last spring, rather than the $300 weekly subsidy the new legislation provides. Democrats had pushed for larger payments to the jobless and included it in legislation that passed the House, which they control. But the measure met stiff resistance from Republicans, who control the Senate, and was not included in the final compromise bill.

A study released in August by three economists, Olivier Coibion, Yuriy Gorodnichenko and Michael Weber, found that recipients of the $1,200 payments sent out under the CARES Act last spring largely held off on spending the money. Only 15 percent of people said they had spent it, or planned to spend it. 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Find more about the measure and what’s in it for you. For details on how to get assistance, check out our Hub for Help.Will I receive another stimulus payment? Individual adults with adjusted gross income on their 2019 tax returns of up to $75,000 a year will receive a $600 payment, and a couple (or someone whose spouse died in 2020) earning up to $150,000 a year will get twice that amount. There is also a $600 payment for each child for families who meet those income requirements. People who file taxes using the head of household status and make up to $112,500 also get $600, plus the additional amount for children. People with incomes just above these levels will receive a partial payment that declines by $5 for every $100 in income.When might my payment arrive? The Treasury Department said on Dec. 29 that it had started making direct deposit payments, and would begin to mail checks the next day. But it will be a while before all eligible people receive their money.Does the agreement affect unemployment insurance? Lawmakers agreed to extend the amount of time that people can collect unemployment benefits and restart an extra federal benefit that is provided on top of the usual state benefit. But instead of $600 a week, it would be $300. That will last through March 14.I am behind on my rent or expect to be soon. Will I receive any relief? The agreement will provide $25 billion to be distributed through state and local governments to help renters who have fallen behind. To receive assistance, households will have to meet several conditions: Household income (for 2020) cannot exceed more than 80 percent of the area median income; at least one household member must be at risk of homelessness or housing instability; and individuals must qualify for unemployment benefits or have experienced financial hardship — directly or indirectly — because of the pandemic. The agreement said assistance will be prioritized for families with lower incomes and that have been unemployed for three months or more.Of course, some of the money flowing into the economy could soon reach those who need it most. And it will provide a financial cushion even for middle-class families who are secure by most measures but remain on edge from the turbulence of 2020.

“In no way am I rich,” she said. “But I feel like my $600 would make a bigger impact on someone who has been dealing with struggles far worse than I have during this pandemic.”

The flip side of falling rates of business investment is a slackening pace of economic growth, which economists have termed “secular stagnation.” It’s this decades-long slowdown that has generated the insecure labour force on which Uber and Lyft rely.

This fight for workers’ rights is grounded in a growing recognition that the expansion of the digital economy does not simply reflect the triumph of an unstoppable technological change. Behind Silicon Valley rhetoric, much of what appears to be technological innovation turns out to be a means of circumventing legal regulations, including minimum wage laws

That governments turned a blind eye to Uber and Lyft’s misbehaviour for so long is no surprise. Governments are complicit in making workers more vulnerable. Facing persistently slow economic growth and high rates of unemployment, governments have spent decades trying to coax companies to invest by making it easier to deny workers’ benefits and to avoid paying taxes.

Capitalist economies have been able to extend security to widening circles of workers only in periods of rapid economic growth, when low rates of unemployment made it possible for more and more workers to demand better wages and working conditions.

High rates of economic growth in the mid-20th century – the reference point for any politics that seeks to restore economic growth in the present – were premised on a historically exceptional period. The restoration of stable international trade following two world wars made possible the largest growth of economic productive capacity in human history, not just in Europe and the United States, but worldwide

By the 1970s, rapid expansion had given way to worsening global overcapacity, resulting in rising competition and falling rates of investment in internationally traded goods. People were left scrambling for work in the growing service sector, where the potential for labour productivity growth, and hence economic growth, is significantly lower.

By misclassifying its workers, Uber avoided paying hundreds of millions of dollars into US state unemployment insurance schemes. Yet during the Covid-19 economic crisis, Uber lobbied the federal government to step in and pay its drivers’ unemployment benefits anyway.

this bid to restore conditions of rapid economic growth, much like supply-side and trickle-down solutions that failed to produce generalised prosperity, was a failure. The Covid crisis has only made economic prospects less auspicious.

People need security that is not tied to their job. The pandemic has revealed this imperative more than ever before. In a world that is as wealthy as ours, and given the technologies we have already produced – even without the realisation of the dreams of automation – everyone should have access to food, energy, housing and healthcare

The owners of Uber and Lyft know that their business is predicated on a world in which they get to make the key decisions that shape our futures, without our input. The world of work is going to have to be democratised. They are just delaying what should be inevitable.

The recession’s inequality is a reflection of the coronavirus itself, which has caused more deaths in low-income communities and severely affected jobs in restaurants, hotels and entertainment venues

No other recession in modern history has so pummeled society’s most vulnerable. The Great Recession of 2008 and 2009 caused similar job losses across the income spectrum, as Wall Street bankers and other white-collar workers were handed pink slips alongside factory and restaurant workers.

“The sectors most deeply affected by covid disproportionately employ women, minorities and lower-income workers.

At the height of the coronavirus crisis, low-wage jobs were lost at about eight times the rate of high-wage ones, The Post found.

The less workers earned at their job, the more likely they were to lose it as businesses across the country closed.

By the end of the summer, the downturn was largely over for the wealthy — white-collar jobs had mostly rebounded, along with home values and stock prices. The shift to remote work strongly favored more-educated workers, with as many as 6 in 10 college-educated employees working from home at the outset of the crisis, compared with about 1 in 7 who have only high school diplomas.

Americans ages 20 to 24 suffered the greatest job losses, by far, of any age group when many businesses closed in the spring. College-age workers and recent graduates tend to be overrepresented in low-paying retail and restaurant jobs, which allow them to gain a toehold in the workforce and save money for school or training.

In the wake of widespread closings of schools and day-care centers, mothers are struggling to return to the workforce. Mothers of children ages 6 to 17 saw employment fall by about a third more than fathers of children the same age, and mothers are returning to work at a much slower rate. This disparity threatens years of progress for women in the labor force.

The unemployed are facing new challenges. Despite President Trump’s promises of a short-lived recession, 26 million people are still receiving now-diminished unemployment benefits. The unemployed went from receiving, on average, over $900 a week in April, May, June and July, under the first federal stimulus package, to about $600 for a few weeks in late August and early September under a temporary White House executive action, to about $300 a week now on state benefits.

What ties all of the hardest-hit groups together ― low-wage workers, Black workers, Hispanic men, those without college degrees and mothers with school-age children ― is that they are concentrated in hotels, restaurants and other hospitality jobs.

Most recessions, including the Great Recession, have affected manufacturing and construction jobs the most, but not this time. Nine of the 10 hardest-hit industries in the coronavirus recession are services.

Economists worry that many of these jobs will not return

While the U.S. unemployment rate has fallen to 8.4 percent, double-digit unemployment lingers in cities and states that depend heavily on tourism.

over 30,000 restaurant and hospitality workers are unemployed in New Orleans, making it nearly impossible to find a job.

Ten percent of renters reported “no confidence” in their ability to pay next month’s rent, according to a U.S. Census Bureau survey conducted Sept. 2 to 14.

Black women are facing the largest barriers to returning to work, data shows, and have recovered only 34 percent of jobs lost in the early months of the pandemic.

It took until 2018 for Black women’s employment to recover from the Great Recession. Now almost all of those hard-won gains have been erased.

Historically, people of color and Americans with less education have been overrepresented in low-paying service jobs. Economists call it “occupational segregation.”

Black and Hispanic men face many of the same challenges as Black women, encountering discrimination in the workforce more often than others, and they struggled to rebound from the Great Recession.

Women had logged tremendous job gains in the past decade before the coronavirus hit.

But with many schools and child-care centers closed and the migration to online learning, many working parents have had to become part- or full-time teachers, making it difficult to work at the same time. That burden has fallen mainly on mothers, data shows. For example, mothers of children ages 6 to 12 — the elementary school years — have recovered fewer than 45 percent of jobs lost, while employment of fathers of children the same age is 70 percent back.

Single parents have faced an especially hard blow.

One in eight households with children do not have enough to eat, according to the September survey by the Census Bureau.

The Fed predicts unemployment will not near pre-pandemic levels until the end of 2023. For many jobs, it may take even longer — especially those already at high risk of being replaced with software and robots.

“Since the 1980s, almost all employment losses in routine occupations, which are relatively easier to be automated, occurred during recessions,”

Many economists and business leaders are urging Congress to enact another large relief package, given the unevenness of the recovery and the long road for those who have been left behind.

“There are very clear winners and losers here. The losers are just being completely crushed. If the winners fail to help bring the losers along, everyone will lose,” said Mark Zandi, chief economist at Moody’s Analytics. “Things feel like they are at a breaking point from a societal perspective.”

After the 2008 financial crisis, it took 12 years for employment rates to get back to pre-crisis levels. But only three years after Covid struck, employment is fully back for almost every age and demographic group.

At this point the employed percentage of adults is at or above early 2020 levels for every age group except those 70 or older.

The overall unemployment rate is only 3.5 percent; we haven’t had that spirit here since 1969. Black unemployment is at a record low. There’s good news everywhere you look.

So whaddya know: Provide enough job opportunities, and lazy video-game-playing Americans will take those jobs and, apparently, demonstrate enough skill that employers want to keep them.

Full employment also turns out to be a powerful force for equality, on multiple dimensions. The gap between Black and white unemployment is now a fifth of what it was when Ronald Reagan proclaimed “morning in America.” A tight labor market has led to big gains for low-wage workers, sharply reducing overall wage inequality.

The big question now is whether the good news on jobs is somehow a mirage, based on an unsustainably hot labor market that will have to cool off drastically to contain inflation.

what does the current data say? To some extent the answer is, whatever you want to hear.

maybe the important point is that almost every measure of inflationary pressure I’m aware of has improved substantially over the past year, with no increase in the unemployment rate

there’s good reason to believe that we can sustain the incredibly good job market we have right now, even while getting inflation under control. And it will be a real tragedy if exaggerated fear of inflation causes the Federal Reserve to push interest rates too high for too long, leading to a gratuitous recession that throws away many of the gains we’ve made.

Republicans keep insisting President Biden’s policies have been an economic disaster, and that even the mainstream news media has tended to emphasize inflation — which has been a nasty shock, even though it may be subsiding — rather than job gains.

So it does seem worth pointing out that at this point Biden is presiding over the best job market America has seen in a generation — specifically since the boom of the late Clinton years. And that, as Biden himself might (almost) say, is a big something deal.

The economics community just hasn't spent much time over the past couple of decades focusing on the effect that machine intelligence is likely to have on the labor marke

The Digital Revolution is different because computers can perform cognitive tasks too, and that means machines will eventually be able to run themselves. When that happens, they won't just put individuals out of work temporarily. Entire classes of workers will be out of work permanently. In other words, the Luddites weren't wrong. They were just 200 years too early

while it's easy to believe that some jobs can never be done by machines—do the elderly really want to be tended by robots?—that may not be true.

Robotic pets are growing so popular that Sherry Turkle, an MIT professor who studies the way we interact with technology, is uneasy about it: "The idea of some kind of artificial companionship," she says, "is already becoming the new normal."

robots will take over more and more jobs. And guess who will own all these robots? People with money, of course. As this happens, capital will become ever more powerful and labor will become ever more worthless. Those without money—most of us—will live on whatever crumbs the owners of capital allow us.

Economist Paul Krugman recently remarked that our long-standing belief in skills and education as the keys to financial success may well be outdated. In a blog post titled "Rise of the Robots," he reviewed some recent economic data and predicted that we're entering an era where the prime cause of income inequality will be something else entirely: capital vs. labor.

We're already seeing them, and not just because of the crash of 2008. They started showing up in the statistics more than a decade ago. For a while, though, they were masked by the dot-com and housing bubbles, so when the financial crisis hit, years' worth of decline was compressed into 24 months. The trend lines dropped off the cliff.

In the economics literature, the increase in the share of income going to capital owners is known as capital-biased technological change

The question we want to answer is simple: If CBTC is already happening—not a lot, but just a little bit—what trends would we expect to see? What are the signs of a computer-driven economy?

if automation were displacing labor, we'd expect to see a steady decline in the share of the population that's employed.

Second, we'd expect to see fewer job openings than in the past.

Third, as more people compete for fewer jobs, we'd expect to see middle-class incomes flatten in a race to the bottom.

There will be no place to go but the unemployment line.

Fifth, as a result of all this, we'd expect to see labor's share of national income decline and capital's share rise.

Fourth, with consumption stagnant, we'd expect to see corporations stockpile more cash and, fearing weaker sales, invest less in new products and new factories

The next step might be passenger vehicles on fixed routes, like airport shuttles. Then long-haul trucks. Then buses and taxis. There are 2.5 million workers who drive trucks, buses, and taxis for a living, and there's a good chance that, one by one, all of them will be displaced

in another sense, we should be very alarmed. It's one thing to suggest that robots are going to cause mass unemployment starting in 2030 or so. We'd have some time to come to grips with that. But the evidence suggests that—slowly, haltingly—it's happening already, and we're simply not prepared for it.

the first jobs to go will be middle-skill jobs. Despite impressive advances, robots still don't have the dexterity to perform many common kinds of manual labor that are simple for humans—digging ditches, changing bedpans. Nor are they any good at jobs that require a lot of cognitive skill—teaching classes, writing magazine articles

in the middle you have jobs that are both fairly routine and require no manual dexterity. So that may be where the hollowing out starts: with desk jobs in places like accounting or customer support.

In fact, there's even a digital sports writer. It's true that a human being wrote this story—ask my mother if you're not sure—but in a decade or two I might be out of a job too

Doctors should probably be worried as well. Remember Watson, the Jeopardy!-playing computer? It's now being fed millions of pages of medical information so that it can help physicians do a better job of diagnosing diseases. In another decade, there's a good chance that Watson will be able to do this without any human help at all.

Take driverless cars.

Most likely, owners of capital would strongly resist higher taxes, as they always have, while workers would be unhappy with their enforced idleness. Still, the ancient Romans managed to get used to it—with slave labor playing the role of robots—and we might have to, as well.

There will be no place to go but the unemployment lin

we'll need to let go of some familiar convictions. Left-leaning observers may continue to think that stagnating incomes can be improved with better education and equality of opportunity. Conservatives will continue to insist that people without jobs are lazy bums who shouldn't be coddled. They'll both be wrong.

Corporate executives should worry too. For a while, everything will seem great for them: Falling labor costs will produce heftier profits and bigger bonuses. But then it will all come crashing down. After all, robots might be able to produce goods and services, but they can't consume them

we'll probably have only a few options open to us. The simplest, because it's relatively familiar, is to tax capital at high rates and use the money to support displaced workers. In other words, as The Economist's Ryan Avent puts it, "redistribution, and a lot of it."

would we be happy in a society that offers real work to a dwindling few and bread and circuses for the rest?

The modern economy is complex, and most of these trends have multiple causes.

 economist Noah Smith suggests that we might have to fundamentally change the way we think about how we share economic growth. Right now, he points out, everyone is born with an endowment of labor by virtue of having a body and a brain that can be traded for income. But what to do when that endowment is worth a fraction of what it is today? Smith's suggestion: "Why not also an endowment of capital? What if, when each citizen turns 18, the government bought him or her a diversified portfolio of equity?"

In simple terms, if owners of capital are capturing an increasing fraction of national income, then that capital needs to be shared more widely if we want to maintain a middle-class society.

it's time to start thinking about our automated future in earnest. The history of mass economic displacement isn't encouraging—fascists in the '20s, Nazis in the '30s—and recent high levels of unemployment in Greece and Italy have already produced rioting in the streets and larger followings for right-wing populist parties. And that's after only a few years of misery.

When the robot revolution finally starts to happen, it's going to happen fast, and it's going to turn our world upside down. It's easy to joke about our future robot overlords—R2-D2 or the Terminator?—but the challenge that machine intelligence presents really isn't science fiction anymore. Like Lake Michigan with an inch of water in it, it's happening around us right now even if it's hard to see

A robotic paradise of leisure and contemplation eventually awaits us, but we have a long and dimly lit tunnel to navigate before we get there.

The labor market has rebounded somewhat since the initial coronavirus wave in the spring. But of the 22 million jobs that disappeared, nearly 10 million remain lost.

“Compared to then, we are doing better,” said AnnElizabeth Konkel, an economist at the career site Indeed, referring to the spring. “But compared to the pre-Covid era, we still have so far to go.”

Perhaps more immediately, President-elect Joseph R. Biden Jr. has pledged to push a stimulus package through Congress that would provide relief to individuals, small businesses, students, schools and local governments.

Biden is pushing for the big steps he says are needed to address immediate needs and control the coronavirus pandemic. He also plans to lay out an economic recovery plan in coming weeks that aims to create jobs and combat the climate crisis, among other measures.

The plan calls for sending another $1,400 per person to eligible recipients. This money would be in addition to the $600 payments that were approved by Congress in December and sent out earlier this month -- for a total of $2,000

nother $5 billion would be set aside to help struggling renters to pay their utility bills.

Biden would increase the federal boost the jobless receive to $400 a week, from the $300 weekly enhancement contained in Congress' relief package from December.

He would also extend the payments, along with two key pandemic unemployment programs, through September. This applies to those in the Pandemic Emergency Unemployment Compensation program who have exhausted their regular state jobless payments and in the Pandemic Unemployment Assistance program, which provides benefits to the self-employed, independent contractors, gig workers and certain people affected by the pandemic.

These are key parts of a $1.9 trillion proposal that President-elect Joe Biden unveiled Thursday evening.

The plan would provide $25 billion in rental assistance for low- and moderate-income households who have lost jobs during the pandemic. That's in addition to the $25 billion lawmakers provided in December.

Biden would extend the 15% increase in food stamp benefits through September, instead of having it expire in June.

The plan calls on Congress to create a $25 billion emergency fund and add $15 billion to an existing grant program to help child care providers, including family child care homes, to pay for rent, utilities, and payroll, and increased costs associated with the pandemic like personal protective equipment.

Biden wants to boost the Child Tax Credit to $3,600 for children under age 6 and $3,000 for those between ages 6 and 17 for a year.

Also, he wants Congress to provide $4 billion for mental health and substance use disorder services and $20 billion to meet the health care needs of veterans.

It also proposes making a $35 billion investment in some state, local, tribal, and non-profit financing programs that make low-interest loans and provide venture capital to entrepreneurs

Under Biden's proposal, people who are sick or quarantining, or caring for a child whose school is closed, will receive 14 weeks of paid leave. The government will reimburse employers with fewer than 500 workers for the full cost of providing the leave.

he plan calls for providing $15 billion to create a new grant program for small business owners, separate from the existing Paycheck Protection Program.

He wants to increase and expand the Affordable Care Act's premium subsidies so that enrollees don't have to pay more than 8.5% of their income for coverage -- which is also one of his campaign promises. (The law is facing a challenge from Republican-led states that is currently before the Supreme Court.)

Biden wants to send $350 billion to state, local and territorial governments to keep their frontline workers employed, distribute the vaccine, increase testing, reopen schools and maintain vital services.

Additional assistance to states has been among the most controversial elements of the congressional rescue packages, with Democrats looking to add to the $150 billion in the March legislation and Republicans resisting such efforts. The December package ultimately dropped an initial call to include $160 billion.

Biden's plan would also give $20 billion to the hardest-hit public transit agencies to help avert layoffs and the cutting of routes.

The plan would provide an additional $170 billion to K-12 schools, colleges and universities to help them reopen and operate safely or to facilitate remote learning.

It would also fund the hiring of 100,000 public health workers, nearly tripling the community health workforce.

The proposal would also invest $50 billion in testing, providing funds to purchase rapid tests, expand lab capacity and help schools implement regular testing to support reopening.

The plan calls for investing $20 billion in a national vaccination program, including launching community vaccination centers around the country and mobile units in hard-to-reach areas

Biden is calling on Congress to raise the minimum wage to $15 an hour, and to end the tipped minimum wage and the sub-minimum wage for people with disabilities.

The result was an aggressive monetary expansion that effectively ended deflation.

The economy responded strongly. From 1933 to 1937, real gross domestic product grew at an annual rate of almost 10 percent, and unemployment fell from 25 percent to 14. To put that in perspective, G.D.P. growth has averaged just 2.5 percent in the current recovery, and unemployment has barely budged.

The lesson here is that fiscal stimulus can help a depressed economy recover — an idea supported by new studies of the 2009 stimulus package. Additional short-run tax cuts or increases in government investment would help deal with our unemployment crisis.

What of the idea that monetary and fiscal policy can do little if unemployment is caused by structural factors, like a mismatch between workers’ skills and available jobs

businesses and workers found a way to get the job done. Factories simplified production methods and housewives learned to rivet.

Here the lesson is that demand is crucial — and that jobs don’t go unfilled for long. If jobs were widely available today, unemployed workers would quickly find a way to acquire needed skills or move to where the jobs were located.

at the end of World War II, that ratio hit 109 percent — one and a half times as high as it is now. Yet this had no obvious adverse consequences for growth or our ability to borrow.

what about the national debt? Given the recent debt downgrade, it might seem impossible for the United States to embark on fiscal stimulus that would increase its ratio of debt to G.D.P.

Everyone understood then why the nation was racking up so much debt: we were fighting for survival, and for the survival of our allies. No one doubted that we would repay our debts. We had done it after every other war, and raising taxes even before the attack on Pearl Harbor showed our leaders’ fiscal resolve.

someone needs to explain to the nation and to world markets just why we must increase the debt in the short run. Unemployment of roughly 9 percent for 28 months and counting is a national emergency. We must fight it with the same passion and commitment we have brought to military emergencies in our past.

The federal data suggests that nearly seven million Californians are receiving pandemic benefits. The state’s data shows that number is under two million.

. But because benefits are paid retroactively, if there are delays processing applications, people can end up applying for multiple weeks of benefits at once, skewing the continuing-claims number.

But now, with no reopening in sight, the worker might decide to file — and to claim, legitimately, to have been out of work since April.

Once the data started coming in, it was often hard to interpret — some states would report thousands of recipients one week, then zero the next.

That would mean the number of people receiving unemployment benefits of any kind right now is 20 million to 25 million, rather than the 30 million suggested by federal continuing-claims data.

The national unemployment rate, as calculated by the National Bureau of Statistics, accounts only for urban unemployment, which stands at just above 5 percent and is believed to be underestimated. The average monthly income of migrant workers was $630 in 2022, or less than half the income of those working for the government. And that data is flawed because it includes only months when a worker has a job.

Mr. Xi said in his speech that the mass return of migrant workers in 2008 and 2020 had not caused any social problems because they “have land and houses back in their home villages so they can return to cultivate the land, have food to eat, and work on something.”

But the prospect of moving back to the villages is often bleak and even scary, especially for younger migrant workers who have spent their adult lives in the cities. They can see what awaits them. Their parents and grandparents may need to work until they physically cannot anymore and hesitate to seek medical care. They usually do not have unemployment benefits, and they cannot rely on their families, as some urban youths do, because their parents’ and grandparents’ pensions are “only enough to buy salt,

The other reality facing migrant workers is that returning to their villages to earn money farming is not an option, as Mr. Xi said it was. There is not enough land waiting for them

“For Chinese, especially in the countryside, there’s no such thing called retirement,” he said. His grandfather is 90 and cleans pig manure for a farm every day in the central province of Henan.

The morning we spoke he had just gotten off a shift that started at 7:30 p.m. and ended at 7 a.m. He had worked for two weeks without a day off because of the demand for Apple’s newest iPhone.

He feels he cannot go home to his village and do nothing while his parents and grandfather are still working. “It’s just not appropriate,”

“My ideal country is one where the people live in peace and prosperity, where there is food safety, freedom of speech, justice, a media that can expose injustices, a five-day, eight-hour workweek for workers,” said Mr. Zhang, the unemployed welder. “If these can be achieved, I will support whoever is in power, regardless of their party or how long they govern.”

Mr. Ge left his village at age 17 and started working on construction sites and in factories. He had benefits during the six years he worked at Foxconn, a contract manufacturer for Apple. But when he was out of work this year, he could not get any unemployment benefits, which is not uncommon as local governments are deeply in debt. Now 34, he still works 10-hour shifts at another Apple contract manufacturer and lives in a dormitory.

“Only people who couldn’t find jobs would do farming,” said Guan, a migrant worker in the northwestern province of Gansu, “because income from farming is too low.”

“To be honest, deep down I feel lost,” he said. “All I can say is that for the time being, I’ll save as much money as possible. As for what the future holds, it’s really hard to say. I might not even live to see that age.”