With the 2001 and 2008-2009 recessions, it took well over three years to recover all of the jobs lost—more than six years with the Great Recession.
Early on, there was hope the 2020 cycle would be “V-shaped” and the economy would recover relatively swiftly, perhaps in less than a year. Early on, it appeared the cycle was conforming to a quick turnaround.
Since then, the pace of recovery has slowed considerably, now forming more of a Nike "swoosh" shape, with a steep downturn and a gradual uptick. At November’s pace of job creation, it would take 29 more months to return to the February level of employment, or about three years in total.
Nonetheless, the unemployment rate is an imperfect measure of the labor market as it only considers people who are actively looking for work. Millions of Americans have left the workforce altogether.
In November, the share of prime working-age Americans (ages 25 to 54) registered at 76.0%, down from 80.5% in February. The overall labor participation rate was just 60.5%, down from 63.4% in February and the lowest level since the early 1970s when far fewer women were in the workforce. This represents about 3.7 million fewer jobs compared to February, BLS reports.
There are several likely reasons why so many people have left the workforce. For one, many parents—particularly women—have decided or were forced to stay home and care for their children as day cares and schools have closed or transitioned to virtual learning. Also, many older baby boomers who were nearing retirement have decided to simply retire early.
Others may have compromised health and prefer to stay home out of fear for their physical well-being, even if it means being out of work. Yet others may have given up on looking for work altogether, discouraged by a poor labor market.
Since September, the number of Americans unemployed for more than 27 weeks rose by 1.5 million people. As short-term temporary unemployment becomes permanent, many people become discouraged and give up looking for work altogether.
It also becomes significantly harder for the long-term unemployed to return to work as skills become outdated, and they may succumb to depression or addiction.
The impact of the recession on women has been particularly poignant, leading some to refer to it as a “she-cession.”
Typically, during recessions, the male unemployment rate rises significantly higher than the female unemployment rate as men often work in more vulnerable sectors, such as construction and transportation. During the Great Recession, for example, men were unemployed at an 11.1% rate versus a peak of 9.0% for women.
However, this is the first recession since the 1970s in which women have faced a significantly higher rate of unemployment. In April 2020, the official unemployment rate for women reached 16.2%, compared to 13.5% for men.
Moreover, significantly more women have left the workforce compared to men. From August to September, among the 1.1 million people ages 20 and over who left the workforce, more than 800,000 were women.
Although the reasons for this dramatic decline in female labor force participation vary, most economists agree the closure of schools and day care centers has disproportionately affected women, both as teachers and parents.
Female workers are overrepresented in education, and mothers are significantly more likely than fathers to stay home with their children to oversee child care and virtual learning.
Recent Census data highlights inequities in the household: 25% of children under age 15 living in married-couple families had a stay-at-home mother, compared to 1% who had a stay-at-home father.
Moreover, the gender pay gap exacerbates this issue. Typically, if households have to choose a parent to stay home with the children, it is the lower-wage earner, which is most often the mother.
Despite some recovery, the percent change in employment since the start of the pandemic for women (-6.9%) remains significantly below that of men (-6.0%). These disparities are particularly large for women of color: the labor force participation rate for prime-age Black mothers fell 6.7% from February to October, more than three times the decline among white women (1.9%).
NEXT: Long-term changes