COVID-19: Increased Unemployment Rates Due to Lockdown
The whole world is facing the spread of a pandemic disease that is a coronavirus. Coronavirus is an infectious disease spread by coming in contact with the infected person. That is why governments are taking all measures to stop mass gathering. Since mass gatherings can spread the virus of COVID-19 on the mass level, which the world has seen in Italy.
Further, Wuhan city, the center of coronavirus, is now free from the lockdown. Yet other countries are still facing lockdown due to coronavirus. A report from Business Insider shows that most of the world population is in some form of a lockdown due to coronavirus. But what does lockdown mean? Lockdown or quarantine implies that the movement of people is being restricted and controlled by their respective governments. Governments ordered the citizens to stay home and only move out when it is necessary. Also, in some countries, police enforcements are charging fines on the people who are not following the orders.
Currently, India is having the biggest lockdown, where 1.3 billion people are lockdown in their homes for 21 days. According to the New York Times, the size of this lockdown is way more than the Wuhan’s lockdown, which is the center of the pandemic. Another big lockdown is in the United States. Here the majority of the cities and states are facing strict reinforcement of the stay at home order. After the U.S., major population lockdown is in Europe, France, Spain, the U.K., and Italy. It means that around 300 million people are lockdown in their homes due to COVID-19. Furthermore, in Russian regions, 142 million people are affected due to lockdown.
The following data has been taken from Statistics.
Job Cuts in Different Industries Due to Coronavirus
In the last week of March, for the first time, 6.6 million people filed for unemployment in the United States. Thus, there are several job cuts in the states due to coronavirus pandemic. A report released on April 2, 2020, by consultancy challenger, Gray, and Christmas, mentioned which industries are adopting the policy of job cut-offs. There are 222,000 job cuts in March and 56,000 in February. Thus, it means that there are 347,000 job cuts in the first quarter of the year 2020 in the United States.
There are significant job cuts in the entertainment and leisure industry, which is around 37%. It means that approximately 83,000 people lost their job due to coronavirus pandemic. All the theatres, concerts, and similar venues shut down since they involve mass gatherings. Thus the entertainment and leisure industry is facing a significant loss in these hard times.
After the entertainment industry, the third in the queue are Amusement parks, Water parks, and Tourist sites. These are also facing a significant loss. Nearly 8,450 people lost their jobs in the services industry. The following is the list of all the sectors affected due to lockdown.
Unemployment Higher Than the Great Depression
Unemployment rates in 2020 were astronomically expected higher for the U.S., and some analysts also predicted that the country would experience the highest unemployment. According to Federal Reserve estimates, millions of people are facing job cuts due to coronavirus crisis. But the worst situation is still yet to come.
By a recent analysis at St. Louis Fed economists showed that there are 47 million employment reductions in the United States. It means that the unemployment rate is 32.1%. Besides this, 30% of people are at high-risk jobs.
Miguel Faria-e-Castro, an economist at St. Louis Fed, in a research paper, wrote that there are 66.8 million people who are “at the high-risk occupation.” These occupations include sales, production of food, and services. Besides this, the research identified 27.3 million people are working in “high contact intensive” jobs. These are barbers, stylists, airline attendants, and food and beverage workers.
This unemployment rate of 32.1% is the highest unemployment rate ever recorded. The second-highest unemployment rate in the U.S. was from the Great Depression, which is 24.9%. Thus, the 2020 unemployment rate is eight points higher than the Great Depression.
