America will recover all jobs lost during Covid by this summer, Fitch says – CNN

by | May 2, 2022 | Jobs

By the end of August, the labor market will have fully recaptured all jobs lost during the pandemic, Fitch Ratings projects in a new report shared first with CNN.If that happens, it means payrolls would have returned to pre-crisis levels in barely two years. By comparison, Fitch said it took a staggering six years and five months for the jobs market to fully bounce back during the painfully slow recovery from the Great Recession. The late summer target for recovering all the jobs lost from Covid-19 looks doable. The United States is only about 1.6 million jobs shy of February 2020 levels.That means payrolls would need to grow by about 400,000 jobs per month to get back to pre-pandemic levels. The economyOne problem is that some workers remain on the sideline, limiting the supply of labor. This is for a variety of reasons, including Covid-related problems, high child care costs and retirements. Just eight states have fully recovered or exceeded their pre-Covid labor force participation rate, according to Fitch. The labor force participation rate of Vermont, Nevada and Maryland remains more than four percentage points below pre-crisis levels. The good news is that the very tight jobs market has lifted wages, especially among lower-income workers. And workers have the flexibility to quit their jobs and get better ones. Yet wages are still The goal is for higher borrowing costs to ease demand, giving supply a chance to catch up. That should ease inflation, allowing the economic expansion to continue. If that doesn’t happen, the Fed may be forced to raise interest rates even more aggressively, slowing down the economy to the point where it risks sparking a recession that sends unemployment rising once again. …

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