Sectors and States Poised to See Worst Job Losses Highlighted in New Research

In this March 21, 2020, file photo, a man walks along a usually busy Fremont Street after casinos were ordered to shut down due to the coronavirus outbreak in Las Vegas.

In this March 21, 2020, file photo, a man walks along a usually busy Fremont Street after casinos were ordered to shut down due to the coronavirus outbreak in Las Vegas. AP Photo/John Locher, File


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About one-in-five American workers were in industries last year that are now bearing the brunt of the economic downturn the coronavirus has caused, according to estimates in one report.

The economic collapse brought on by the coronavirus pandemic is going to hurt some sectors and states more than others. Businesses like restaurants, bars and entertainment venues are among those taking heavy hits, as are regions that depend heavily on travel and tourism.

Two recent analyses—one from U.S. Bureau of Labor Statistics researchers and another from the Urban Institute—shed additional light on how this economic damage could look, and provide insights that may be useful for deciding how to target relief programs.

The BLS research finds that, in 2019, about one-in-five American workers were employed in industries that are now most immediately affected by the virus outbreak and its economic fallout.

Research economists Matthew Dey and Mark Loewenstein authored the BLS report, which looks at jobs and wages in the most vulnerable sectors. They also examined which states have the highest shares of jobs in those fields.

The Urban Institute has an interactive map tool that displays estimates at the county, metropolitan area and census tract level for where the most low-income jobs are being lost.

The BLS economists focused their analysis on a set of industries that is expected to be most affected by the widespread business closures and stay-at-home orders that are part of efforts to control the spread of the virus. Here the researchers relied on a set of six sectors that  University of Chicago economics professor Joseph Vavra came up with.

These business lines include: restaurants and bars; travel and transportation, like airlines, taxis and transit; entertainment and recreation, such as gyms, ski resorts, casinos and amusement parks; personal services, like dentists and barbers; “other sensitive retail,” such as clothing stores and car dealers, and “sensitive manufacturing,” like makers of aircraft parts and cars.

Dey and Loewenstein found that restaurants and bars accounted for a little over 8% of total U.S. employment last June, with roughly 12.2 million workers. Overall they concluded that, in that June 2019 timeframe, about 30.5 million workers, or 20.4% of the overall workforce, were employed across the at-risk sectors.

Aside from the manufacturing category, they also found that the share of the nation’s wages within each of the sectors was lower than its share of jobs in the overall workforce. This suggests that, on average, workers in the vulnerable industries earn less than people working in other parts of the economy.

The analysis also found that the share of employment in the sectors most affected by the virus is highest in states like Nevada (34.3%), Hawaii (31.1%), Florida (23.7%), and South Carolina (23.1%). These states have economies that tend to rely more heavily on tourism than other places, with many travel and transportation sector workers.

Some of the states with the lowest shares of workers in the vulnerable sectors are in the Midwest and have lots of agriculture—like Nebraska (16.3%), Iowa (16.8%), Arkansas (17.4%) and Minnesota (17.4%).

These findings generally align with an earlier analysis the Brookings Institution released last month, although that report additionally flagged metro areas that depend on the gas and oil sector as especially susceptible to the ill economic effects of the pandemic.

The Urban Institute’s estimates, last updated on April 16, show that nationwide about 14.3 million low-income jobs have been lost amid the pandemic. Of these, nearly four million are estimated to be in the accommodations and food services sector.

Low-income jobs are defined here as those with annual earnings below $40,000.

While the institute’s mapping tool includes granular job-loss figures at the county, metro area and neighborhood levels, the group cautions that the numbers are estimates and may not track with actual employment statistics in each place.

The Urban Institute recommends interpreting the estimates as relative job-loss levels, which give a sense of which areas are being hit harder by the economic downturn.

The Urban Institute estimates can be found here, and the Bureau of Labor Statistics analysis here.

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Bill Lucia is a Senior Reporter for Route Fifty and is based in Olympia, Washington.

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