Record 47.2 percent of working-age Americans
By Shannon Jones
July 02, 2020 "Information
Clearing House" -According to newly released
Bureau of Labor Statistics (BLS) figures, 47.2 percent
of working-age Americans were without work in May, the
highest level recorded since the end of World War II.
The numbers are based on the BLS
employment-population ratio, which states the proportion
of the total labor force who are actually working. It is
a more accurate measure of joblessness than the monthly
unemployment report, which counts only those actively
At the end of May the employment-population ratio
stood at 52.8 percent; it stood at 61.2 percent at the
start of the year. The employment-population ratio
reached a postwar high of nearly 65 percent in 2000.
Citing Torsten Slok, the chief economist at Deutsche
Bank, CNBC said it would take the creation of an
additional 30 million jobs to bring the
employment-population ratio back to January levels.
The report comes ahead of the release of the official
jobless statistics for June later this week. They are
expected to reflect a marginal decline in the official
unemployment rate from 13.3 percent in May to 12.4
percent in June. It is not known if the June figures
will correct the previous undercount in the numbers of
May and April, when millions of workers were incorrectly
classified. This resulted in the official jobless
percentages being about 3 percent lower in May and 5
percent lower in June.
The official unemployment rate remains at Great
Depression levels in a number of states. Nevada, hard
hit by the shutdown of the gaming industry, had an
unemployment rate of 25.3 percent in May compared to 4.0
percent one year earlier. Hawaii stood at 22.6 percent
in May compared to just 2.7 percent one year earlier,
while Michigan registered 21.2 percent compared to 4.2
percent in May 2019. In California and Massachusetts,
unemployment stood at 16.3 percent in May.
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Joblessness was the highest in the leisure and
hospitality sector, 35.9 percent. Retail was at 15.1
percent, construction at 12.7 percent and
manufacturing at 11.6 percent. Among young people
age 16–19, 29.9 percent were unemployed and 23.2
percent of workers age 20–24 had no work.
Despite the reckless early reopening of state
economies during the course of June, there were around
1.5 million new claims each week for unemployment
benefits. Many workers do not have a job to come back
to. This is particularly the case for those employed at
small businesses, such as restaurants, which could not
survive the shutdown. A further wave of larger
bankruptcies is also expected.
The full impact of this economic collapse will hit
toward the end of July when the temporary weekly
increase of $600 in unemployment benefits enacted in the
CARES bill ends. The cutoff, scheduled for the week
ending July 25, will slash income by about two-thirds
for 20 million workers and will lead to a surge in
hunger and evictions.
Personal income dropped 4.2 percent in May, despite
the supplemental payments. The cutoff will be
particularly devastating for low-wage workers, since
regular unemployment benefits cover half or less of
The moratorium on evictions from federally subsidized
housing contained in the CARES Act is also set to expire
at the end of July, meaning that millions of families
could soon confront the possibility of being in the
street. According to the latest US Census Bureau
Household Pulse Survey, 30 percent of renters had little
or no confidence that they could meet housing payments
for the next month.
A patchwork of state and local temporary bans on
evictions are expiring or are being challenged by
landlord associations. A statewide eviction ban was set
to expire in Florida on July 1, barring a last-second
extension by the governor. A statewide ban in Virginia
expired June 29. In San Francisco, a citywide ban is
being challenged in court. Earlier this month, an
eviction ban expired in New York City, leading to
warnings that 50,000–60,000 eviction cases could soon be
filed in housing courts.
Andy Winkler of the Bipartisan Policy Center issued a
warning reported in Politico of a “tsunami” of
evictions following the expiration of the $600
It is clear that corporations are using the crisis
caused by the pandemic to carry out a major
restructuring, including the permanent elimination of
huge numbers of jobs. According to the International
Monetary Fund, the world economy will contract by five
percent in 2020, with US GDP down by eight percent. The
GDPs of Mexico and Europe are expected to decline 10
percent, while China will show no growth. The second
quarter in the US is expected to show the largest
quarterly contraction since the end of WWII.
In an indication of what is to come, Airbus announced
15,000 job cuts worldwide by 2021 as it restructures its
operations, an 11 percent reduction. Ten thousand job
losses will be in Germany and France alone.
In recent years, spokesmen for the ruling class have
been bitterly complaining that record low unemployment
had created “tight labor markets” and demands for rising
wages. The destruction of tens of millions of jobs will
now be used by corporations as a hammer to demand a new
wave of wage and benefit cuts from workers. This has
already been seen in the airlines and among
Amidst this devastation, the US stock market closed
June with one of the best quarterly rises in history.
The Dow Jones Industrial Average rose 216 points
Tuesday. For the second quarter, the Dow Jones rose 16
percent, erasing most of the losses of the first quarter
of 2020. Apple, Home Depot, Dow and Microsoft were among
those making the strongest gains. The S&P 500 showed a
19.1 percent gain for the quarter, while the Nasdaq is
up 11 percent for the year.
The rise in the markets comes as COVID-19 cases surge
in the United States, with record numbers of new
infections, following the lifting of all attempts by
federal and state governments to control the virus. The
stock rise has been fueled not by an improving real
economy, but the unlimited infusion of cash by the US
Federal Reserve. Like a heroin addict, the markets rely
on ever-greater injections of liquidity to maintain
their inflated levels. Meanwhile, the attacks on
workers’ jobs and living standards become ever more
ferocious as the corporate oligarchy attempts to claw
back the money from the hides of workers.
Workers should not accept that they shoulder the
economic burden for the criminal and inept response of
the capitalist authorities to the coronavirus pandemic.
The massive resources going to the financial markets
must be redirected to meeting pressing human needs.
Workers made jobless by the spread of the virus and
necessary health measures must have their incomes and
livelihoods protected. This requires the independent
political mobilization of the working class on the basis
of a socialist and internationalist program.
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