As the world is adapting to what is now the “new normal,” Fairygodboss wants to be there for you every step of the way. Keep reading for timely advice and join our Navigating the New Normal group for continued support.
Still, the Department of Labor reports that 3,169,000 people made initial claims for unemployment insurance in the week ending on May 2. And experts worry even as businesses reopen, there will be increasing layoffs among government and white collar workers.
The Associated Press reports that "a second wave of layoffs could result if state and local governments must sharply cut spending this summer because of revenue shortfalls," according to director of macroeconomic policy at the Washington Center for Equitable Growth Claudia Sahm. Governments have lost tax revenue from economic shut downs as they spend more on health care and social services to carry the weight of COVID's impacts.
"The hole is so big,” Sahm told The Associated Press. “They're going to have to fire a bunch of teachers and firemen."
Meanwhile, David Roeder, a labor reporter for the Chicago Sun Times, predicts that white collar professionals who were less directly tied to the shut downs may soon see the ripple effect on their employment.
"The jobs impact first hit in the hotels, airlines, bars and restaurants. It spread to department stores, boutiques, fitness clubs, movie theaters. Then on to some manufacturers, or at least those whose products were not deemed essential for the crisis," he wrote at the end of April. "The logistics business is starting to feel it because each shutdown takes out a customer. Then come all the service industries and consultants that draw income from what’s shuttered."
Essentially, industries that cater to the businesses that laid off employees weeks ago will begin laying off as loss of revenue ripples down the food chain, especially if changes to consumer spending have as large of an impact on critical industries as predicted and large companies don't bounce back quickly.
However, The Associated Press does indicate that 80% currently unemployed people expect to return to their previous employer after they are reopened. Those people returning to work easily could diminish the impacts of COVID on consumer spending and, ultimately, on the economy over the next few months.
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