THE MOST FRIGHTENING PANDEMIC NUMBER OF ALL
The New York Times wants you to read David Brooks today. Read — or listen- to this instead.
One of the distinguishing characteristics of the reporting on coronavirus these last months is how many numbers are flying around. Number of cases, deaths, graphed out on numerical charts. Numbers convey certainty. But a lot of these numbers don’t hold up from breakfast to lunch as some new set of data gets reported.
With so much data flying around A lot of journalism is being written in the subjunctive mood. Reporters write, Doctors or epidemiolgists say “this” could happen. Well “this” could, “this” might, but then again, “this” might not happen at all.
Covid-19 is a journey into the unknown, best to leave the speculation aside. It can only add to the public’s fear.
The one piece of data whose meaning can be speculated on in well documented historical context has nothing to do with the virus.
It is this: 26 million people filed for unemployment in the five weeks after President Trump announced the pandemic was a national emergency. It is the greatest number of job losses since the Great Depression.
But in the great depression mass unemployment didn’t happen in 5 weeks. From the Wall St Crash in October 1929 it would take three full years for unemployment to peak at 25% of the workforce, In no single five week period did anything like 26 million, which represents 18.5% of the current American work force become unemployed.
Beyond the unprecdented scale of the event is this fact: Each recession since 1981–82 has been used by employers to reduce wages and shed permanent employees particularly in manufacturing.
When Ronald Reagan took office, people who earned a living making things represented 30 percent of total employment in America. These workers suffered 90 percent of job losses in that recession. According to the Federal Reserve’s history of the event, the residential construction industry and auto manufacturers ended the year with 22 percent and 24 percent unemployment, respectively.
Car makers took advantage of the situation to automate. Many of those who got laid off because of lack of demand never worked an assembly line again. This pattern was repeated during the shorter recession of the early 1990s, this time it was salaried workers in the Defense industry that bore the brunt — well, the Cold War was over, we had reached the end of history — the number of jobs in defense permanently shrank by 10%
Today, according to the Bureau of Labor Statistics, only 8.5% of Americans work in manufacturing. The US is now a Service economy but the average manufacturing job still pays 12% more than other salaried employment.
As for what happened after the crash of 2008, check google for how many references there were to the term “gig economy” before and after that particular cataclysm.
But the biggest reason to fear 26 million people losing their jobs in a little over a month isn’t the numerical proof that each recession has produced lower paid and less secure, more casualized employment. It is this: Statistics don’t measure the shock to society of joblessness.
There are no numbers explaining the shock in going from 30% of the workforce being in production of goods down to 8.5% today?
There are photos of the rust belt: still boarded up downtowns and abandoned factories and Ohio shopping malls photogrpahed by Seph Lawless only hint at the shock.
The studies of Princeton economists Angus Deaton and Anne Case on declining life expectancy, their coining the term “Deaths of Despair” get at it a little more.
Then there is the personal shock of job loss multiplied by millions. I am particularly attuned to the statistically immeasurable shock of job loss. In 2005, I was laid off. I was on the wrong side of 50, working in an industry — journalism — where 1/2 of newspaper jobs and a quarter of radio journalist jobs would disappear in the next decade. I have never had full-time salaried employment since.
The shock has never gone away.
Anger subsides to bitterness. You do what you have to do and make do with less. But you remember — can’t help but remember — what employment at what you were good at and earning a decent living doing was like and can’t help but feel the hurt. The British call being laid off “being made redundant” a word that means, according to the Oxford English Dictionary, “no longer needed or useful; superfluous.”
How does a society deal with the shock of sudden mass unemployment? There is an historical example, and it is not a happy one.
In 1928 Germany held elections. The terrible hyper-inflation crisis from the early part of the decade was over, recovery — fragile — was underway. The unemployment rate was around 4.5%. The Social Democratic Party won the election, with around 30% of the vote. The National Socialist German Workers Party came in 9th place with 2.6% of votes cast. No surprise, the party had been banned from elections since the 1923 Munich Beer Hall Putsch and Adolf Hitler’s brief stint in prison. There were better established, less crazy, nationalist parties for voters that way inclined, to turn to.
Two years later, in the next Parliamentary election, the Social Democrats came first again. This time the National Socialists were second with 18.2%
What had happened in the intervening two years? The Crash of 1929’s knock on effect in Germany saw a rise of 40% in unemployment. Still smouldering anger from the defeat of WW1 was reignited by the individual bitterness of the newly unemployed multiplied overnight by hundreds of thousands. Hitler’s rage-filled performances captured the hearts and minds of many of the embittered. As unemployment grew so did the Nazi share of the vote, until … well, you know what happened next.
It was the collective social memory of the consequences of those votes cast during the bitter days of mass unemployment that led contemporary Germany to the concept of Kurzarbeit: the government at all levels and local institutions work to protect employees during sudden downturns. I first learned about this in early 2009 when I went to Hamburg to report on the aftermath of the Crash in Europe’s economic engine room. The great port was idle but its workers had not been made redundant. They were still employed, albeit on reduced wages.
In America, after the 2008 Crash people were simply laid off, and, as in the recessions of 1981–82 and the early 90s many never found full-time employement again. A lot of people dropped out of the labor force altogether. It would take until just before the coronavirus arrived for all the jobs lost in 2008 to be recovered and for wages to catch up to their pre-Crash levels.
Many look at the 26 million laid off in the last five weeks and think when the country re-opens those folks will all be summoned back to work. It is a reasonable guess to say, based on the history of the last 4 decades, many of them won’t.
And then the bitterness will kick into overdrive. Bitterness already characterizes far too many Americans. The well spring of that bitterness has been the regular shocks to the world of employment and its increasing casualization. The bitterness has been a factor in elections at all levels now for a while. And there is a big one coming in November.
From what I know about coronavirus it seems probable that it will dissipate, a vaccine will be found, our societies will move on. I am hopeful.
From what I know about the individual shock of losing your job multiplied by tens of millions I can only worry. Work, more than anything, is the force that gives life meaning and making tens of millions of lives meaningless overnight cannot come to any good.
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Michael Goldfarb is the host of the FRDH, First Rough Draft of History, podcast
