The coronavirus pandemic has ravaged businesses and economies around the globe. Many businesses have gone under due to a lack of staffing and many other regulations being unable to be followed. We have recently seen a new variant, the delta variant, really damage some businesses as they are just beginning to open up again. In August of 2021, job growth in America was terrible. This is demoralizing not only to the American people but also our economy as we were just beginning to dig ourselves out of the COVID-19 hole.
We see a problem in businesses reopening as they cant find low-wage workers to staff. This leads to understaffing which leads to closing sooner which is less money for the business. This unfortunately doesn't look like it is going to change any time soon either. Some Americans have refused to get vaccinated along with refusing to get masks, now that the summer is over cold weather is coming leading many activities and meetings to be indoors in closed spaces, making the virus more susceptible to spread.
The US economy is struggling and the job market is the source of it. Almost everywhere you go out to eat you see a hiring sign. Many restaurants are even offering higher wages but this still doesn't seem to work. Once jobless Americans begin to start working again, we will see a boost in our economy. Businesses will be open longer allowing them to make more money, also paying employees money in order for them to spend more money. This is a big issue we face right now that Americans aren't pouring much money into the US economy due to unemployment.
link: https://www.cnn.com/2021/09/08/opinions/economy-weakening-goldman-sachs-covid-filipovic/index.html
2 comments:
I do agree with you on some points, but is the U.S Economy truly weakening, or is there some other factors?
On one hand you have severe supply chain droughts and demand going through the roof, but due to the pandemic firms are not able to meet that demand and thus sales drop, which leads to drop in revenue, which then means firms have to cut costs in the form of jobs. In turn, firms cut labor but now need to hire back the people they cut during the pandemic.
On the other hand, labor shortage is very interesting and is sometimes uncorrelated to the economy. During the pandemic we say several stimulus checks, and people file for unemployment so getting a job and working would yield less even if they were paying 15$ and hour and hiring. There is no incentive to go back to work and the government is rewarding people who don't have a job, and good workers are hard to come by.
I agree with the comment above. I have discussed the unemployment rate on several other posts. Even if jobs are hiring with a larger hourly wage, there are many individuals who are being paid more on unemployment and with the stimulus checks to even consider looking for a job. As Prof. Skosples mentioned in class, the stimulus checks played a huge role in encouraging people to stay home and same with unemployment checks. However, we need to begin to move back into "normal" sooner rather than later or our economy could take a significant hit. I believe that the stimulus checks should slowly be taken away so that people are forced to get back into the work force and contribute toward the economy. The government cannot continue to give the stimulus checks when there's limited money coming back in from the workforce.
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