COLORADO SPRINGS – After high expectations for job growth in August, the month’s report for hiring was disappointing, according to Ph.D. economist Tatiana Bailey. Bailey told FOX21 News that fact is adding to her fears that the factors dragging the economy down go beyond the fall-out resulting from the pandemic.
Bailey, the director of the University of Colorado-Colorado Springs Economic Forum, says the rapid spread of the Delta COVID-19 variant has added to the uncertainty during recovery efforts because, “when you have a disruption this large, the recovery is going to be in fits and starts.”
“What came to a halt was the spending on services, especially hospitality and retail,” Bailey explained.
8.4 million people are still out of work with 1.7 million jobs lost in hospitality since February 2020.
Now past August, an estimated additional 42,000 jobs have been lost from restaurants and drinking establishments.
Bailey says of those not working, 5.6 million people say they remain out of work because they worked for a business that closed down.
“I worry a lot about that. I speak to small businesses owners in the area all the time. Restaurants or retail, they’re all saying the same thing – that this has been a huge disruption for them and even if they got a [Paycheck Protection Program] loan, it’s expired and it helped them for a relatively short period of time.”
Bailey reported that even in states which ended supplemental unemployment benefits from the federal government, job growth remained similar to those states which kept payments.
Bailey says that is evidence there is more holding people back from working than just getting extra money for not working.
“Child care was an issue pre-pandemic, the skills gap was an issue pre-pandemic, a shrinking labor force just because of the demographics and people having fewer kids than 10, 20, 30 years ago, that’s another structural issue. So all of those things need to be addressed,” Bailey explained.
During the week of September 6, the U.S Department of Labor reported 310,000 first-time unemployment claims, a low during the course of the pandemic. The number is still high based on pre-pandemic standards, but as many schools begin to return across the country after Labor Day, Bailey says she remains hopeful.
“I wouldn’t throw in the towel and say, ‘the sky is falling’. I do think we’ll see some better numbers in September,” she said.