You need to know where you stand in this economy. You need a reasonable
projection of whether you might have a good job 6 to 12 months from now.
Among the periodic faux-happy jobs reports (“Unemployment isn’t as bad this
month as it was last month!”) and the near-daily upward drive of the stock
market, followed by the announcement that we’ll have a vaccine by Election Day,
you can be forgiven for believing that a recovery – and a stable job – is just
around the corner.
We are in a recession that the pandemic kicked off. But this recession’s
underpinnings have been building for years. Even before the pandemic, we had a
middle-class jobs and wages problem. The number of stable middle-class jobs
has been dropping for years. Even those with seemingly stable middle-class jobs
had trouble covering all of their living expenses in addition to saving for
retirement in an job market that offers fewer and fewer pensions for retired
people. Wages haven’t kept pace with inflation for the past 40 years.
But up until right before the pandemic, we’ve all been told that the U.S. economy
is doing great – and that the performance of our stock market proves it. Trouble
is, the average working person in the U.S. hasn’t been doing “great,” financially
speaking, at least not since the 2008 recession. And the performance of the
stock market has not been linked with the financial health of most working
people for many years.
Most people are tied to the stock market only through their retirement accounts,
but many don’t have enough put away in those accounts for adequate retirement
savings. And they’re often dipping into those retirement accounts in order to pay
current expenses, perpetually paying back one or two 401(k) loans at time. How
does great stock market performance help these people? It doesn’t.
It’s tempting to believe that a COVID vaccine will bring jobs back and that it will
end the recession. But that’s not likely. The hardest hit industries will need time to
rebuild. Not all jobs will come back and those that do may come back with pay
cuts.
For example, jobs in the travel industry are in danger, obviously. But other
industries that feed into areas of the travel industry will suffer, too. Food suppliers
that provide snacks and meals to the airlines. Manufacturers and distributors of
airline uniforms. Restaurants and stores inside the airports and all the different
distributors and manufacturers that supply those restaurants and stores. All of
these industries will continue to suffer for some time before they are able to
recover. And the longer the economic distress lasts, the more widespread the
distress becomes and the harder and longer the recovery will be.
Government could help. It could implement jobs programs such as infrastructure
and training programs that have job matching services, after helping to
implement strong unemployment compensation systems such as those that have
allowed European workers to weather the COVID-19 storm. Thus far, we have
seen no sign of any plans for relief beyond the short-lived CARES Act.
Instead, we are facing a steep slide into economic despair, under a government
refusing to work toward a lasting economic recovery, beyond lying about a
vaccine being available by election day. That’s this administration’s entire
economic recovery plan: A COVID vaccine. But jobs will not come right back as
soon as a vaccine is available. Sure, a few jobs will return, but not all, or even
most of them.
A vaccine won’t end this recession. But our government won’t tell you this. It
wants you to be happy about the stock market and believe that a stock-market
rise signals a strong economy, but that’s foolish. Look around with clear eyes and
know where you stand in this economy.
