Jobless American filing for unemployment during covid-19 pandemic

The State of American Jobs

5 min read • May 11, 2020 • Derek Miller

The coronavirus pandemic has wreaked havoc on almost every aspect of American lives. Loved ones have been lost, trips and weddings postponed, and savings accounts drained because of job loss and a crashing stock market.

While many people will bounce back in the coming months, some Americans will continue to feel the economic effects of COVID-19 long after it passes. Let’s explore the current state of the US job market and what today’s job losses mean for the future economic outlook.

The Unemployment Numbers Don’t Paint a Full Picture

CNN recently reported that US unemployment rates have not been this low since 1939 and that unemployment levels will continue to strain the economic recovery efforts long after the restrictions are lifted.

An April 2020 study from McKinsey and Company said that 26 million Americans (1 in 6 workers) have applied for unemployment benefits. 

While unemployment rates give some insight, the number of people affected is significantly higher than these totals.

First, many of the applications have yet to process. In Florida, the unemployment website was so poorly maintained that large crowds formed in-person to fill out paper enrollment applications. 

While the largest wave of furloughs and layoffs are likely behind us, the US unemployment numbers continue to grow as the queue of pending applications gets processed.

Next, unemployed workers only make up part of the economic portrait of America. Millions more are affected financially because of pay cuts, reduced hours, and other reductions in tips and commission-based income. 

Even employees who currently have work right now have likely noticed at least somewhat of a drop in income. For example, a Lyft driver may still be working, but the number of riders during lockdown has decreased significantly.    

So when looking at US unemployment rates to determine how well our economy is handling the pandemic, keep in mind that those numbers are just the tip of the iceberg.

Each Industry is Affected Differently

While almost every business has been affected by the pandemic, some industries have been hit harder than others. The report by McKinsey & Company found that hospitality and leisure workers are impacted much more than all other industries.

These hospitality workers are part of a broad swath of employees, ranging from restaurant waitstaff and bartenders to hotel employees and personal trainers. In fact, during the week of March 21, hospitality workers in 8 sampled states accounted for 40% of unemployment claims. 

Other workers who were also highly affected include those in the retail trade, professional and business services, and transportation, construction, and utilities. 

During a pandemic, getting another job isn’t usually an option. Entire industries have shut down. Data from Emsi found that job postings have declined 16% since February 2020—a drop of nearly 1 million listings. Suddenly, every job listing prompts a huge increase in applicants as demand for employment soars. 

Vulnerable Populations Will Suffer the Most

Low-income workers, part-time employees, young workers, and minorities were disproportionately laid off or furloughed during this pandemic. 86% of the jobs lost as of mid-April came from fields where workers made less than $40,000 annually. 

Additionally, workers without a bachelor’s degree were nearly twice as likely to hold vulnerable jobs that were affected.   

When you consider racial and gender demographics, minority workers were more likely to have lost their jobs. The Bureau of Labor Statistics (BLS) found that racial minorities make up 20% of the workforce but 25% of unemployment claims. Women also made up 59% of those who initially lost their jobs. 

These demographics also reflect the challenges ahead for people returning to the workforce. Women, minorities, and low-income earners all have a harder time finding long-term and full-time work, which means they could be looking even longer to replace the jobs they had. 

Not All Jobs Are Coming Back

Even if every case of COVID-19 were cured tomorrow, many of the jobs that were lost wouldn’t come back. Some small businesses have had to close their doors permanently following state lockdowns. These small business owners are not likely to launch a new company any time soon.

Other businesses have made cuts because of the coronavirus and will operate a leaner, more affordable business until they feel comfortable again—which could take months or years depending on their financial conditions.

Customer behavior will also affect the economies and job markets of certain regions. Take hospitality and tourism as an example. Families who relied on savings to get through this pandemic may be in debt or without extra funds for the next few months. People are also going to be less likely to travel until they know it’s completely safe.

Frugality and general safety concerns mean honeymoons, Disney trips, and other family vacations will get canceled or put on hold. Fewer people are traveling, which means a decrease in demand for hospitality workers and employees in tourist-centric regions. It’s possible that states like Hawaii and Florida could take longer to recover without a glut of tourist dollars flowing in over the next several years.

Both state and federal government branches are working to provide economic support for affected Americans. These efforts range from the $1,200 stimulus checks to emergency small business loans on a local level. However, the job market will not be as strong as it was before 2020, and the most vulnerable populations will be hit the hardest. 

Derek Miller

Derek Miller is the CMO of Smack Apparel, the content guru at, the co-founder of Lofty Llama, and a marketing consultant for small businesses. He specializes in entrepreneurship, small business, and digital marketing, and his work has been featured in sites like Entrepreneur, GoDaddy,, and StartupCamp.