Now is not the time to cut expanded unemployment benefits for workers and their families


The labor market added 266,000 jobs in April – solid growth but far below expectations, says Heidi Shierholz, director of policy at the Economic Policy Institute and former chief economist at the U.S. Department of Labor.

Growth in March was also revised down, she notes, and the U.S. economy still has 8.2 million fewer jobs than existed before the recession

And that 8.2 million is not the total gap in the labor market, Shierholz says. Pre-COVID, the economy was adding about 200,000 jobs a month, so the total gap in the labor market is actually around 11 million jobs when compared to pre-pandemic growth patterns.

“There are certainly a lot of anecdotal reports right now of employers not being able to find the workers they need, particularly in restaurants,” she said.

A key footprint of labor shortages is wage growth, Shierholz says. “Employers who truly face shortages of workers will respond by bidding up wages to attract those workers, and employers whose workers are being poached will raise wages to retain their workers.”

Wages of nonsupervisory workers in leisure and hospitality have risen in recent months, but have only now gotten back on their pre-COVID trend, she says. “This is not signaling a massive shortage.”

Leisure and hospitality added 331,000 jobs in April, even though average weekly earnings for nonsupervisory workers in that sector equate to annual earnings of just $20,628.

“The claims of labor shortages in restaurants are largely the result of frustration on the part of restaurants that they can’t find workers to fill jobs at relatively low wages,” Shierholz said.

Some other key indicators from the April jobs report:

  • The Black unemployment rate rose slightly to 9.7 percent, making Black workers the only racial and ethnic group (as a whole) to experience worsening metrics. Meanwhile, the white unemployment rate fell to 5.3 percent. Clearly, these two groups are experiencing a very different labor market.
  • Long-term unemployment — those unemployed 27 weeks and over — fell slightly in April, while the increase in the unemployment rate was due to increases in those unemployed less than five weeks. Among those long-term unemployed, improvements in those unemployed 27-51 weeks were largely offset by increases among those unemployed 52 weeks or longer.
  • Only 18.3 percent of the workforce teleworked in April. That means over 80 percent of the workforce is going to work in-person, risking their health and the health of their family members as the pandemic continues to spread.
  • In addition to the 9.8 million officially unemployed in April 2021, there are three more groups of economically hurt workers: those unemployed but misclassified as employed or not in the labor force (3.3 million); those who dropped out of the labor force (4.4 million); and those employed but experiencing a cut in pay and hours (4.6 million). Taken together, 22.1 million people still hurting economically as a result of the COVID-19 downturn.


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