Layoffs soar amid slow economic recovery
The U.S. economy lost 22 million jobs at the outset of the coronavirus outbreak
Moody's Analytics chief economist Mark Zandi argues it will be a 'a long time' before all the jobs lost during initial stages of the coronavirus pandemic are back.
The U.S. economy is slowly recovering from a deep coronavirus-induced recession that began in February, but workers continue to be furloughed – even at some of the country’s largest and most profitable companies.
Last week 837,000 Americans filed unemployment claims, the Labor Department announced on Thursday.
The U.S. economy lost 22 million jobs at the outset of the pandemic – only about half of which have been recovered so far.
But economists caution that as long as the virus – and related restrictions – prevail, the U.S. will continue to combat economic difficulties.
“As long as the pandemic is on, the economy is going to struggle,” Moody's Analytics chief economist Mark Zandi told FOX Business’ Maria Bartiromo during an interview on Thursday. “We’re down 11 million jobs from the pre-pandemic peak – half of those are temporary lay-offs … but the other half are permanent.”
DISNEY TO LAY OFF 28,000 EMPLOYEES AS COVID-19 CONTINUES TO HAMMER ITS BUSINESSES
Zandi noted that because many small business are failing, a number of the individuals who lost their jobs have done so permanently.
But it’s not just small business workers that are affected.
The Walt Disney Company announced on Tuesday that it planned to lay off 28,000 employees – who it refers to as “cast members” – across its parks.
A pair of popular airlines – American Airlines and United Airlines – each announced tens of thousands of layoffs as the sector continues to struggle to attract passengers while the virus threat is prevalent.
photo credit: iStock
United Airlines said it would begin furloughs – for 13,000 employees – as early as Thursday after lawmakers failed to agree on a relief package that would provide more federal aid to airlines.
Similarly, Americans Airlines will begin furloughing 19,000 employees on Thursday.
UNITED AIRLINES SAID THE AID IMPASSE FORCES IT TO FURLOUGH 13,000 WORKERS
Late Wednesday, insurance giant All State said it would lay off 7.5% of its workforce – or 3,800 employees – as part of a restructuring plan.
And Wall Street behemoth Goldman Sachs resumed layoffs this week, which includes around 400 jobs. Layoffs had been paused during the pandemic.
| Ticker | Security | Last | Change | Change % |
|---|---|---|---|---|
| DIS | THE WALT DISNEY CO. | 112.08 | -0.65 | -0.58% |
| UAL | UNITED AIRLINES HOLDINGS INC. | 52.97 | +0.13 | +0.25% |
| AAL | AMERICAN AIRLINES GROUP INC. | 13.98 | +0.10 | +0.72% |
| ALL | THE ALLSTATE CORP. | 169.58 | -0.49 | -0.29% |
| GS | THE GOLDMAN SACHS GROUP INC. | 430.81 | +3.24 | +0.76% |
The government will give an update on the labor market on Friday, where economists – including Zandi – are expecting modest improvements to the overall economic picture, including job creation and unemployment.