- The US had a 14.7% rate of unemployment in April.
- Researchers estimate that 42% of pandemic-induced layoffs will result in a permanent job loss.
- COVID-19 will have ‘profound, long-term consequences for the reallocation of jobs, workers, and capital across firms and locations’.
The numbers are finally capturing the full magnitude of the economic downturn the coronavirus pandemic has caused. The US Bureau of Labor Statistics, for example, recently announced a 14.7% unemployment rate for April.
While this reallocation shock is good news for some sectors, the authors find the news particularly troubling for others.
“We estimate that 42% of recent pandemic-induced layoffs will result in permanent job loss,” says Steven J. Davis of the University of Chicago Booth School of Business, a leading expert on hiring practices, job loss, and the effects of economic uncertainty.