Opinion | The August jobs report shows delta is claiming livelihoods. Here’s how the government must respond.

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How this recession compares to previous ones

Percent change in employment since most recent peak.

0

Other post-

World War II

recessions

Where we

are now

Great Recession

and subsequent

recovery

-5%

Worst point after

the Great Recession

-10%

-15%

1

10

20

30

40

50

60

70 months

Months since the last employment peak

Note: Because employment is a lagging indicator, the dates for these payroll employment trends are not exactly synchronized with the National Bureau of Economic Research’s official business cycle dates.

Sources: Bureau of Labor Statistics, via Haver Analytics

THE WASHINGTON POST

We really need much faster growth, too. There are still roughly 5.3 million fewer jobs today than existed when the pandemic began last year. If August’s pace of hiring were to continue, it would take almost two more years before as many jobs existed as in February 2020.

So what went wrong? Why did hiring sputter? Delta’s fingerprints are all over this report.

The sectors most sensitive to covid risk took a major beating. Food services and drinking places (that is, restaurants and bars) lost 41,500 jobs in August. The sector had been growing rapidly, averaging 227,000 jobs per month over the prior six months. That industry is deeply in the hole; there were almost a million fewer bar and restaurant jobs in August than there were when the pandemic began.

The retail industry also lost jobs. So did, somewhat counterintuitively, the health-care sector — perhaps a result of more hospitals delaying elective procedures, patients avoiding nursing homes and other congregant settings, and/or staff at those places burning out and quitting. Employment at child-care facilities — tenuous even before the pandemic — also fell.

Meanwhile, there were increases in economic activities likely to be boosted by higher covid risk. The number of people who teleworked, for example, rose for the first time since December. Hiring also increased in the transportation and warehousing sector.

But warning signs are flashing. Privately produced data on restaurant and flight bookings show Americans are becoming more cautious. So what can be done to boost employment for the workers and industries at risk?

Republicans will likely argue for cutting unemployment benefits, and roughly 7.5 million people are slated to lose their benefits on Labor Day as the remaining federally funded emergency unemployment programs end. But remember: A lot of states have already halted participation in these federal programs. So far, the states that cut access early do not appear to have appreciably different rates of job growth than those states that have kept the extra benefits in place.

There are a lot of differences between states besides this one policy choice — including rates of covid transmission. But one reason why reducing unemployment benefits might not have much effect on hiring is that so many other factors are also holding people back from taking available jobs. These include lack of child care, transit issues and of course rising covid risk.

Note that many people have dropped out of the labor force entirely, which usually disqualifies them from receiving jobless benefits.

It is quite possible that reducing jobless benefits while the economy remains weak could ultimately slow down the recovery, at least in some parts of the country. That’s because people who lose benefits but are still unable to find or accept available jobs now have less spending power. The local businesses they rely on then have less money coming in. This, besides the obvious humanitarian argument, is one reason to extend some version of enhanced benefits in places where covid is still wreaking havoc on the job market, and where persistent child-care and school closures are making it difficult for parents to maintain reliable employment. (The Biden administration has encouraged some states to extend higher benefits on their own, by drawing on another source of federal funds.)

The Federal Reserve could also intervene, but it’s in a tricky position. If it eases monetary policy further — or in any event, delays when it pumps the brakes — it risks stoking more inflation. Already, inflation is unusually high and a rising worry for consumers and businesses.

The best and most obvious remedy? Clamp down on covid transmissions. As has been the case since early 2020, the virus is in control of the economy; to get the economy back on firmer footing, we must control the virus.

This is easier said than done, of course, particularly in some Republican strongholds. In Florida and Texas, for instance, the governors have forbidden vaccination mandates, making it harder for consumers and workers to safely resume their normal economic lives. By barring schools from requiring students to wear masks, politicians have virtually ensured that more students will go into forced quarantine and schools will shut down again, jeopardizing both children’s academic progress and their parents’ work arrangements.

But if governors want their economies to recover — and their voters to stay alive — they must get vaccination rates up and encourage (or, better yet, require) other complementary mitigation strategies, particularly for children too young to get vaccinated. The federal government, too, must use every available lever to encourage vaccination. That includes mandates or incentives for more sectors over which it has jurisdiction (such as air travel or medical facilities receiving federal dollars).

Instead, perversely, some Republican lawmakers are trying to block such measures, even as they complain about the slowdown in hiring that is the obvious result of uncontrolled covid spread.

As I said last month: The key to more jobs is more jabs.