Return To Normalcy (CONT’D FROM PAGE 28)
for those people to get back into the labor pool. Finally, there is some level of health concern by employees going back into the workplace, especially if they are older work- ers or higher risk people.” While the future of the labor market remains unset- tled, the opening months of 2021 might provide clues as to whether hiring difficulties will continue. “Perhaps as we
ployment picture were brightening. Yet the expectations here are, once again, for only gradual improvement. The unemployment rate is expected to decline to 7.8 percent by the end of 2021. “The labor market will not recover all COVID-19-related job losses until the second half of 2023,” says Koropeckyj. A brightening jobs picture should translate directly into a boost in take home pay. Moody’s anticipates 2021 wage increases to come to 2.5 percent—a level high enough to allow shoppers to exhale but too low to spark rapid spend- ing. Hoyt’s expectations for improvements in the public psychology are suitably conditional: “We are assuming a slight upward trend in consumer confidence until we get a vaccine or an effective treatment, at which point it will probably move up faster.” Tight Labor Conditions in the labor market are also preventing a faster recovery. Not only is the unemployment level high, but employers are not finding the job applicants they need. “Companies are having problems recruiting and getting folks to apply for work,” says Palisin. “Some things going on in the labor market are probably contributing to that. First, the portion of the workforce still on furlough will probably not take another job but will return to the one they were furloughed from. Second, there are childcare is- sues as students go back to school online and it’s difficult
get into the new year people will start to feel more com- fortable returning to the workforce, the childcare issues may be resolved, and a vaccine will be developed,” says Palisin. “But right now there seems to be a lot of hesitancy in the labor pool. People are sitting on the sidelines to see what is going to happen.” CONTINUED ON PAGE 32
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