Over 30 million workers have filed unemployment claims in the last six weeks. That represents approximately 23% of the workforce. Many of the newly unemployed workers came from industries you would expect to be hit hard in a pandemic, such as the hospitality industry and small businesses.
But very few job sectors have escaped the wrath of the COVID-19 virus. Even jobs that are typically seen as “safe” are being hit. This includes government jobs at the state and local levels, jobs in healthcare, and jobs that require a significant amount of technical skill and training. In most cases, it is rare for workers in these industries to ever file for unemployment benefits. Yet, many of these employees find themselves out of work, and while some of these layoffs may be temporary, some of these jobs may never return.
State & Local Governments Are Laying Off Thousands Nationwide
Government jobs are often considered to be a “safe” choice for employment. What you give up in maximum earning potential is usually made up for with increased job stability, good benefits, and a decent pension. But that idea if being flipped upside down by the COVID-19 response.
A recent survey by the National League of Cities shows that 96% of municipalities anticipate budget shortfalls this year due to revenue decreases caused by the COVID-19 response.
Many state and local governments are feeling the pain caused by social distancing requirements and shuttered businesses. Closed businesses don’t bring in revenue which means they aren’t collecting sales tax and they aren’t paying employment taxes. As a result, cities and municipalities are dealing with decreased revenue streams. Municipal coffers are running dry and many government agencies have already announced unpaid furloughs and layoffs.
In Los Angeles, the mayor has called for thousands of city employees to take 26 unpaid days of leave this year, which basically amounts to a 10% pay cut.
Detroit, facing a $348 million budget deficit, is laying off over 200 part-time workers, cutting hours for full-time workers, freezing pay, and cutting some salaries by 5%. The city also expects additional cuts to services.
These are just two small examples of how municipalities are dealing with the COVID-19 crisis. Experts estimate that thousands of state and local government employees will be forced into filing for unemployment benefits.
Even Healthcare Workers Are Being Laid Off
According to the Bureau of Labor Statistics, the healthcare industry has been one of the hardest-hit since the coronavirus response started in March, with the industry being in the top 5 for most jobs lost.
It seems unimaginable that healthcare workers would be laid off or furloughed during a pandemic. But it is becoming increasingly common among medical workers who are deemed “non-essential.” While the focus is on taking care of patients who are critically ill or who have COVID-19, other non-essential medical procedures have been placed on hold. This has forced thousands of healthcare employees across the nation to be furloughed.
Thousands of doctors, nurses, and other medical staff have been laid off in California due to the coronavirus outbreak. Cookville Regional Hospital, in TN, recently furloughed approximately 400 employees, or about 16% of its staff, and reduced hours for several hundred more.
These stories are becoming more common in many regions of the United States. While many of these job losses are temporary, it’s not guaranteed that all of them will return.
Airlines and Related Industries are Planning Massive Layoffs - Including Highly Skilled Pilots and Technicians
For the last several years, airlines couldn’t hire enough pilots. There have even been concerns that they wouldn’t have enough pilots in the next few years, as airlines increased routes and older pilots were forced to retire due to FAA age regulations. To address this need, the airlines were recruiting heavily from the military ranks, offering sizable signing bonuses, and offering excellent pay and benefits. That has changed in the last two months as the COVID-19 response has decimated travel, leading airlines to cancel close to 95% of their flights.
Under the terms of the
recent government bailouts, the airlines can’t lay off employees for 6
months. But that doesn’t mean they aren’t planning now for the
inevitable. United Airlines
Until two or three months ago, this would have been unthinkable. These are not easily replaceable employees. Commercial airline pilots require years of training and thousands of hours of flight time before they are eligible to fly commercial routes.
But the airline industry
has been hit harder than many industries and it may be years before the
industry recovers. Even Warren Buffett showed his concern by selling Berkshire Hathaway
And it’s not just airline employees that are losing their jobs. Boeing
Which Jobs Are Safe Going Forward?
Several popular memes have floated around the Internet telling high school and college students to look at which employees are considered essential - those are the jobs you should strive for. That seems like excellent advice in the current environment. But one could have easily made the same argument three months ago for jobs at state and local governments, the medical field, and even with the airlines.
