According to the Federal Reserve Economic Data (FRED) website, April 2020 recorded the highest unemployment rate during the COVID-19 pandemic at 14.8%. As of March 2022, the unemployment rate has reduced to 3.6%, which is 0.1% higher than the pre-pandemic level of 3.5% as reported for January and February of 2020. In addition, the Bureau of Labor Statistics reported the following observations comparing the data of March 2022 with that of February 2020:
| Indicators | February 2020 | March 2022 | Change |
| – Number of unemployed persons | 5.7 million | 6.0 million | 0.3 million |
| – Number of permanent job losers | 1.3 million | 1.4 million | 0.1 million |
| – Number of long-term unemployed for 27 weeks or more) | 1.093 million | 1.4 million | 0.307 million |
| – Number of persons not in the labor force who want a job | 5.0 million | 5.7 million | 0.7 million |
| – Labor force participation rate | 63.4% | 62.4% | 1% |
| – Employment-population ratio | 61.2% | 60.1% | 1.1% |
Based on the indicators above, the employment scene is returning to the pre-pandemic level, yet hiring is not happening fast enough. So much so that big companies are offering huge sign-on bonuses and other perks to attract workers as seen by these headlines:
- 04/18/22 – Telecommunications giant Verizon announced that it is raising its minimum wage of most employees to at least $20 an hour. It is also offering sign-up bonuses for retail specialist and assistant manager positions.
- 04/12/22 – The Air Force is offering between $3,000 to $50,000 to entice recruits to enter 15 career fields, and the offer is good up to end of September.
- 03/03/22 – As of January 1st of this year, tech hospitality company SevenRooms gives every new hire two weeks of paid time off (and health insurance coverage) before they start their first day with the company.
- 02/28/22 – Retail giant Target announced new starting hourly wage ranging from $15 to $24, and broader, faster access to health care coverage starting in April.
Discussion Questions:
- What are your thoughts about the current state of unemployment in the U.S. economy based on the FRED data over the last two years from February 2020 to March 2022?
- Select TWO of the four news articles, read, identify and explain which type of unemployment is currently happening – cyclical unemployment, frictional unemployment, structural unemployment OR a bit of each?
- Do you think the sign-on bonuses is sustainable in keeping the new hires? Do explain.
- Self-reflection: Looking around your neighborhood, schools and/or workplace, do you think the unemployment levels are approaching the pre-pandemic level as shown by the table above? Do explain.
Sources| Unsplash.com: Group of business workers standing with hands together doing symbol at the office; FRED Economic Data: Unemployment rate; US Bureau of Labor Statistics: Economic News Release – Employment Situation Summary, March 2022; The Balance: What is long-term unemployment?; The Balance: What is the Labor Force Participation Rate Formula?; The Balance Careers: Sign on bonus definition; WQAD8 ABC: Verizon’s new minimum wage is nearly three times the federal level; AviationPros: As recruiting sags, Air Force offers big bonuses; Make it: This company pays new hires to take a vacation before they even start; Target: Target to set new starting wage range and expand access to health care benefits to more team members; FED of St. Louis: Unemployment – The Economic Lowdown Video Series; Photo by Tim Mossholder on Unsplash