As of September 4, Wisconsin terminated its increased unemployment benefits. What does the latest data reveal?
in short:
- (Measured) Labor shrinkage
- The employment impact is mixed
- Leisure and hospitality industry has accelerated
These points are highlighted in the image below:
figure 1: Labor force in Wisconsin, seasonally adjusted (blue), logarithmic scale. Source: BLS.
figure 2: Civilian employment in Wisconsin (more than 16 people), seasonally adjusted (blue), and non-agricultural employment (from the corporate survey) all use a logarithmic scale. Source: BLS.
Even if there is no error in handling outliers (such as BLS release), household surveys at the state level have much larger variances than the series of establishments.Therefore, one should be skeptical of any short-term changes in the labor force and civilian employment series (see more discussion here). The agency survey showed that after September 4 (one point before the survey date in the middle of each month), there was no major change in the total number of employed persons.
Some people think that we should focus on high-touch services. Yesterday’s post The comparison between manufacturing and leisure and hotels is shown, but below are detailed information about accommodation and catering services and overall leisure and hotels.
image 3: Employment in leisure and hospitality services (blue, left) and accommodation and food services (brown, left) in Wisconsin are seasonally adjusted logarithmically; and new covid-19 cases (green, proportions on the right).Source: BLS, and Wisconsin Department of Health Services.
Although the employment growth rate of these service industries has accelerated, it is not clear whether it is due to the improvement of the new crown epidemic situation that promotes development.
In general, I don’t know of any strong evidence that the number of employed people has soared after the termination of enhanced welfare programs state by state. PBS NewsHour has an article recently. For a more formal analysis covering the experience prior to September, please refer to this Paper.
