Things were starting to return to some semblance of normal for a little while. Then the Delta variant struck. This more dangerous variant of COVID has once again threatened multiple facets of our lives, including work and employment.
For job seekers, the news is discouraging. What will the Delta variant mean for them? Will businesses stop hiring? Will we see a return to the chaos of early last year?
According to Minneapolis Federal Reserve Bank president Neel Kashkari, uncertainty abounds as the Delta variant threatens to drastically alter the labor landscape once again.
“It’s creating a bunch of caution,” he told CBS’ Face the Nation.
This could impact businesses’ willingness to hire new workers and even encourage them to return to a previous landscape in the early pandemic days when layoffs and furloughs were commonplace.
Plus, there’s the fact that 7–9 million Americans are still out of work, Kashkari said.
As businesses grapple — and often walk back — their decisions to reopen their offices, hiring decisions only add another layer of complexity, one executives and leaders may want to put off for the time being.
But others are more optimistic. As of late July, Mark Zandi, the chief economist at Moody’s Analytics, continues to predict a “very strong second half of the year,” in spite of the Delta surge. He doesn't expect GDP to decrease significantly; for that to happen, he said, a massive business shutdown and a return to shelter in place would have to take place, which he sees as unlikely.
Ian Shepherdson, the chief economist at Pantheon Macroeconomics, is also optimistic. He noted that the Delta variant is mostly spreading at a fast pace in states that are low in GDP and populations.
“I don’t think Delta is going to go exponential nationally,” he said. “If it just moves up fairly steadily, and it doesn’t lead to a big wave in hospitalizations, I think most people will be fairly relaxed about it, and won’t change their behavior much.”
But that doesn’t mean the picture is necessarily rosy. Shepherdson cautioned that because the vaccine rate in the US remains relatively low, there is another, more dangerous possibility on the horizon.
“I can say right now Delta isn’t a big macroeconomic issue,” he said. “But it can go from zero to sixty really quick.”
He pointed to the reopening of schools on the horizon as an indication of what’s to come. This, he explained, will mean there are more people working, but schools could once again move to remote classrooms.
Zandi added that the Delta variant could also have repercussions for the global supply chain and cause confidence to dip.
“Why would this be the end of it?” he continued. “There will likely be other variants. We are in an arms race with the virus.”
Ultimately, economists tend to agree: the job market will reflect the health and safety landscape. While job seekers can’t control what measures individual businesses take, they can do their part to curb the spread of COVID.