In this report, we analyse both UI claims data and vacancy data from Burning Glass Technologies to provide a more detailed account of how the labor market evolved over the last weeks. In particular, we ask how broad-based the deterioration in market conditions over the second half of March and the first half of April was.
1. Vacancy postings collapsed at the same time as initial claims spiked, declining by 30% of the level at the beginning of the year. The observed decline in vacancies posted is roughly two-thirds of that observed in the U.S. during the Great Recession.
2. To a first approximation, the labor market collapsed at the same time across the U.S. irrespective of the state-level policies imposed. There is very little evidence that labor markets in states that were hit more heavily by the epidemic or that imposed stay-at-home orders earlier were differentially affected.
3. The labor market is in broad retreat across almost all industries, whether they are deemed essential or non-essential. The main exception is for frontline jobs such as those in nursing and essential retail, which saw no decline in postings and smaller, though still pronounced, spikes in claims. As a result, these areas will see substantial labor reallocation.
4. The labor market collapsed across occupations, regardless of work conditions. Occupations that lend themselves to working from home did see a slightly smaller spike in UI claims, but experienced an even larger decline in job postings, compared to jobs where working from home is likely not possible.
We show the labor market is currently experiencing unprecedented weakness. The broad based nature of the collapse in vacancy postings and spikes in UI claims suggest the current damage is not solely caused by stay-at-home orders. Instead, the deterioration of the labor market is a national phenomenon driven by a national crisis. Furthermore, sectors are experiencing similar collapses whether they are directly restricted or only indirectly affected. We therefore conclude that the damage to the economy is unlikely to be undone simply by lifting stay-at-home orders.
Chosen excerpts by Job Market Monitor. Read the whole story @ Labor Demand in the time of COVID-19: Evidence from vacancy postings and UI claims