Posted February 4, 2022
Nationwide—In January, as the Omicron variant swept the nation, payroll employment increased by more than 467,000 jobs, according to this morning’s monthly jobs report. The unemployment rate remained steady at 4.0%, and 6.5 million workers were unemployed. The unemployment rate for Black workers was 6.9%, more than twice the rate for white workers (3.4%), a result of structural racism embedded in the U.S. labor market. Overall, 800,000 more people were unemployed than in February 2020, just before the pandemic hit, and millions more have still not returned to the workforce.
“However much we want to see the economy recover, we can’t wish away the pandemic,” said Rebecca Dixon, executive director of the National Employment Law Project. “Policymakers can only work to mitigate it, to protect the health and safety of workers and communities, and to support people who cannot work. Devastatingly, Congress yanked away pandemic unemployment and sick leave benefits long before the COVID-19 crisis ended, abandoning at-risk people, parents and caregivers, and workers thrown out of their jobs. The harshest economic consequences are being felt in the same Black and Latinx communities that were hardest hit from the beginning.”
Black and Latinx workers were nearly twice as likely as white workers to report a loss of employment income in early January.
In the first 10 days of January, nearly 12 million Americans reported not working because they were recovering from COVID-19, caring for a loved one sick with the disease, or trying to avoid becoming ill, according to the Census Bureau. The number of sick and caregiving workers was the highest since the Census Bureau started counting in April 2020. Black and Latinx workers were nearly twice as likely as white workers to report a loss of employment income in early January.
Today’s jobs report also reveals that 6.0 million workers were unable to work in January because their employer closed or lost business due to the pandemic—nearly twice as many as the prior month. Only 23.7% of these workers received any pay from their employers for the hours they could not work. Because Congress terminated federal pandemic unemployment benefits in September, jobless workers who would have qualified for benefits due to these closures and other disruptions—including low-paid workers, the self-employed, and workers misclassified as independent contractors—have instead been left with no support. And Congress’s continued failure to pass long-term UI reform means even workers who do qualify for benefits are left with outdated state programs that provide insufficient benefit amounts and inadequate duration to meet the needs of unemployed workers and their families.
As the pandemic continues to disrupt labor markets even as social supports have been stripped away, record numbers of workers in low-paying industries—including food service, hotels, and retail—are taking matters into their own hands: they are refusing to put up with inadequate pay, unstable schedules, and poor working conditions. In December, 4.3 million workers quit or changed jobs, sustaining a near record level of quits. Yet, while the so-called “Great Resignation” has enabled some underpaid workers to attain higher wages, economic security remains elusive for many Black and Latinx workers. Workers’ increased bargaining power may be short-lived: durable policy change is needed to cement workplace gains and advance racial and economic justice.
The continuing economic turbulence underscores the urgent need for permanent, structural reform of the unemployment insurance system. Senator Ron Wyden’s Unemployment Insurance Improvement Act would begin to address some significant ways the unemployment insurance system disproportionately excludes Black and Latinx workers, women workers, and workers with disabilities. It does so by providing at least 26 weeks of unemployment benefits, increasing coverage for part-time workers, and expanding eligibility by requiring states to consider workers’ most recent earnings and standardizing earning requirements. These reforms lay the groundwork for transforming our unemployment insurance system and enabling all workers to thrive.