Economist Paul Krugman: The ‘situation remains dire’ for America’s ‘hardest hit workers’
The United States’ unemployment rate, according to the Bureau of Labor Statistics, fell to 8.4% in August — which is an improvement over unemployment rates of 13.3% in May, 11.2% in June or 10.2% in July. But liberal economist Paul Krugman, in his September 7 column for the New York Times, emphasizes that millions of Americans are still hurting financially and are not feeling an economic recovery.
“What some economists and many politicians often forget is that economics isn’t fundamentally about data, it’s about people,” Krugman explains. “I like data as much as, or probably more than, the next guy. But an economy’s success should be judged not by impersonal statistics, but by whether people’s lives are getting better. And the simple fact is that over the past few weeks, the lives of many Americans have gotten much worse.”
The U.S., according to Krugman, isn’t doing nearly enough to help all the Americans who are still out of work because of the coronavirus pandemic.
“Between Labor Day and school reopenings, there’s a pretty good chance that the virus situation is about to take another turn for the worse,” Krugman argues. “But things have already gotten worse for millions of families that lost most of their normal income as a result of the pandemic and still haven’t gotten it back. For the first few months of the pandemic depression, many of these Americans were getting by thanks to emergency federal aid. But much of that aid was cut off at the end of July, and despite job gains, we’re in the midst of a huge increase in national misery.”
Krugman adds that the federal government’s jobs report for August “wasn’t great considering the context.”
“In normal times,” Krugman notes, “a gain of 1.4 million jobs would be impressive, even if some of those jobs were a temporary blip associated with the census. But we’re still more than 11 million jobs down from where we were in February.”
The Times columnist adds that economically, “the situation remains dire for the hardest hit workers” in the United States.
“The pandemic slump disproportionately hit workers in the leisure and hospitality sector — think restaurants — and employment in that sector is still down around 25%, while the unemployment rate for workers in the industry is still over 20%, more than four times what it was a year ago,” Krugman observes. “In part because of where the slump was concentrated, the unemployed tend to be Americans who were earning low wages even before the slump.”
To make matters worse, Krugman notes, the extra $600 per week that unemployed Americans were getting because of the CARES Act “ended on July 31.”
“There is often a disconnect between the headline numbers and the reality of American life, and that is especially true right now,” Krugman stresses. “The fact is that this economy just isn’t working for many Americans, who are facing hard times that — thanks to political decisions by Trump and his allies — are just getting harder.”