We use a repeated large-scale survey of households in the Nielsen Homescan panel to characterize how labor markets are being affected by the COVID-19 pandemic. We document several facts. First, job loss has been significantly larger than implied by new unemployment claims: we estimate 20 million lost jobs by April 6th, far more than jobs lost over the entire Great Recession. Second, many of those losing jobs are not actively looking to find new ones. As a result, we estimate the rise in the unemployment rate over the corresponding period to be surprisingly small, only about 2 percentage points. Third, participation in the labor force has declined by 7 percentage points, an unparalleled fall that dwarfs the three percentage point cumulative decline that occurred from 2008 to 2016.

More Research From These Scholars

BFI Working Paper Jun 29, 2017

Monetary Policy Slope and the Stock Market

Andreas Neuhierl, Michael Weber
Topics:  Financial Markets, Technology & Innovation, Fiscal Studies
BFI Working Paper Dec 4, 2019

Perceived Precautionary Savings Motives: Evidence from FinTech

Francesco D'Acunto, Thomas Rauter, Christoph Scheuch, Michael Weber
Topics:  Fiscal Studies
BFI Working Paper Aug 1, 2016

Cash Flow Duration and the Term Structure of Equity Returns

Michael Weber
Topics:  Fiscal Studies