Feb 10, 2022 - Economy

Labor markets rebound

Labor force relative to Q4 2019

Labor markets in advanced economies bounced back super-fast relative to pre-pandemic levels, but the U.S. is slightly behind.

Why it matters: Consider it took years for jobs to come back after the 2008 financial crisis. This is like no other economic recovery in history, said Claire Li, an assistant vice president at Moody's who helped put together this data.

Context: Though we're lagging on this bounce-back measure — the U.S. unemployment rate is actually lower than in several of these countries, including Canada and Australia, a separate Moody's analysis shows.

  • Lingering COVID worries are keeping workers home in the U.S. That's because they have caregiving responsibilities or they're older and are worried about getting sick — and long COVID, too.
  • The United Kingdom and Euro area are ahead partly because of the way they headed off job losses at the start of COVID, using fiscal relief to keep workers attached to the job market — instead of paying unemployment benefits to workers.
  • Canada's stellar recovery might have something to do with the fact that our neighbors to the north haven't seen as many COVID deaths or cases, Li said. (Canadian readers email me with more info please.)

The bottom line: The labor market recovery here has Larry David vibes: It's pretty...pretty...pretty good but specific COVID issues hold the U.S. back.

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