Meanwhile, COVID Is Still Hurting the Economy

One of the weird things in The Discourse is how many pundits et alia have decided that waves of COVID, not to mention other respiratory viruses, somehow don’t affect the economy (boldface mine):

Researchers say the virus is having a persistent effect, keeping millions out of work and reducing the productivity and hours of millions more, disrupting business operations and raising costs.

In the average month this year, nearly 630,000 more workers missed at least a week of work because of illness than in the years before the pandemic, according to Labor Department data. That is a reduction in workers equal to about 0.4 percent of the labor force, a significant amount in a tight labor market. That share is up about 0.1 percentage point from the same period last year, the data show.

“That may sound tiny, but having that persistent difference over a period of two-and-a-half years is a big deal,” said Jason Faberman, senior economist at the Federal Reserve Bank of Chicago.

Another half a million workers have dropped out of the labor force due to lingering effects from previous Covid infections, according to research by economists Gopi Shah Goda of Stanford University and Evan J. Soltas at the Massachusetts Institute of Technology. In a Census Bureau survey in October, 1.1 million people said they hadn’t worked the week before because they were concerned about contracting or spreading the virus….

The virus’s lingering effects on staffing have forced employers to change how they operate, such as keeping more people on payroll so that work continues without interruption during surges of infections, and cross-training staff and standardizing processes so that one person’s absence doesn’t slow down a project. That has made many companies less efficient.

“Even if people have immunity and death rates are now much lower, they’re still getting Covid. It’s an incredible strain on workers, and a lot of businesses can’t fill shifts,” said Claudia Sahm, a former Fed economist and founder of macroeconomic policy research firm Sahm Consulting. “Every time we have a wave, it sets us back and slows down the recovery.”

Aaron Sojourner, a labor economist at the W.E. Upjohn Institute for Employment Research, estimates that at least one million people weren’t working in October because of current or past Covid infections. Aside from a few big spikes, the number of short-term Covid absences has held relatively steady through the pandemic, on average, but the number of extended absences due to long Covid absences has been adding up.

All told, he said, “It’s a drag on the economy’s productive capacity and output, and creates some inflationary pressure and disruptions.” These are likely to worsen if past patterns of rising infections in winter hold, he said.

Since our political betters on both sides of the aisle clearly don’t give a shit about our health, maybe they would care about the economy? Now that the midterms are done, maybe the Biden administration could dip their toe into the water and suggest–just politely suggest–people wear masks? Perhaps even model the behavior themselves? They also might want to tell hospitals to release asymptomatic and symptomatic patient intake data, so we have some idea of the scope of the problem. Because, on the consumer side, I think there are enough people scaling back their activities–most businesses operate with low profit margins–that it will affect business profits and survival too.

Of course, there’s a whole bunch of other stuff the Biden administration should be done and the Congress should be funding, but I’ll indulge in the soft bigotry of low expectations and just ask for better prevalence data and a kinder, gentler masking campaign.

This entry was posted in COVID-19. Bookmark the permalink.

1 Response to Meanwhile, COVID Is Still Hurting the Economy

  1. Joe Shelby says:

    Meanwhile over in the tech and entertainment (Disney) sectors, “we need people we need people we need people we need people we need people we are in a hiring freeze and laying off 40,000 across the country!”

Comments are closed.