During the spread of the pandemic, Americans have lost over 8,011,181 low wage jobs, according to the Urban Institute. Nationally, the food and accommodation industry has suffered the most with 2,846,224 unemployed. The health care and social assistance industry follows with 868,542 unemployed, followed by retail with 615,369 unemployed.
Back in May, before leaving his position, Andrew Schaufele, former head of the Bureau of Revenue Estimates, prophesied that due to the pandemic low wage employees in Maryland would be the most impacted. He was right. Low-wage workers Prince George’s County, Maryland — a mostly African-American middle-class county with deep pockets of poverty — have lost thousands of jobs. (The county leads the state of Maryland in confirmed coronavirus cases). Businesses in Prince George’s County have fired, or let go, 29,142 low-income employees. Of that, 11,115 are within the food and accommodation services, 3,626 health care and social assistance employees, and 2,819 are retail employers, which serve as the top-three jobs eliminated, according to the latest data. In addition to all of this, women This is compounded by low workers, Schaufele said, that never returned to the job market during the first recession. Prince George’s County’s unemployment rate is 9.9 percent, down from 10.9, which is higher than the state average (8.3 percent).
Schaufele said that the recovery for low wage workers will be slow — and that the state has an opportunity to reinvest in retraining opportunities.
Due to the lackluster implementation of laws to mitigate the spread of the virus, it has begun to spread again. States are reverting to earlier restrictions to prohibit the spread of the virus. Such restrictions slow down hiring and rehiring or low wage workers.
The Paycheck Protection Program funds did stop some companies from closing and to continue to pay employees for a while. However, employers still fired their employees. Back in June, CNBC reported that a National Federation of Independent Business study found that 14 percent of businesses would fire their employees after using up Paycheck Protection Program funds. However, the latest numbers show that it has turned out to be 22 percent. Low-wage workers may linger in the unemployment wilderness, which may eventually add to poverty in certain states. A second coronavirus stimulus package may be on the verge of passing. Recently, the president has signed executive orders pushing out parts of the relief for Americans. However, as predicted the president slashed the extra unemployment insurance benefit from $600 to $400. To make matters worse, not all will who apply for unemployment receive the extra benefits. Such a seemingly minor drift from $600 to $400 will affect will disproportionately affect African Americans and Latinos.
But it’s not only the lack of unemployment funds, nor the lack of funds to pay low wage employees, it’s also telework — among high skilled/ white-collar jobs — that is furthering job insecurity.
“If [telework] displaces a meaningful fraction of professional office time and business travel, the accompanying reductions in office occupancy, daily commuting trips, and business excursions will mean steep declines in demand for building cleaning, security, and maintenance service; hotel workers and restaurant staff; taxi and ride-hailing drivers; and myriad other workers who feed, transport, clothe, entertain, and shelter people when they are not in their own homes,” Autors and Reynolds wrote.
They add: “A substantial, long-run demand contraction in these services will mean significant job loss — or lock-in of existing COVID-induced job losses — and a sustained period of labor market adjustment.”
(Low-wage jobs’ insecurity is further compounded with uncertainty when companies increase the minimum wage because it is likely that those positions will soon be automated ).
However, telework — according to Autor and Reynolds — has an economic upside for the companies that pay a lot of money for employers’ travels and meals. It reduces company expenses for employers and employees.
“Not only is providing and maintaining physical offices costly for employers, but also the need to be physically present in offices imposes substantial indirect costs on the employee,” Autor and Reynolds wrote.
There are is another phenomena. White-collar jobs are being replaced by artificial intelligence, not automation. This has created openings within, what is known as, high-skilled jobs. Though these openings in high skilled jobs are present, it doesn’t necessarily mean that low-skilled workers have or will have the opportunity to fill the void. Low wages workers — unless they have received specialized training courses and or completed a digital literacy program- lack the varied skills to work as a data analyst, in upper management, visual data design, etc. Employers often fill these high skilled job vacancies with current employees with similar skills, do in-house training for a new position, or hire temporary contractors, which often saves them money.
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