Data: Federal Reserve; Chart: Rahul Mukherjee/Axios
The big picture:
Economists have theorized for a while about the impact of COVID deaths on the labor market. Now, research
has started to emerge and key public figures like Powell are starting to talk about it explicitly.
to a half a million who would have been working ... died from COVID,"
Powell said while talking about the U.S. labor shortage.
- Go deeper: In a footnote to a speech he gave on Nov. 30, Powell estimates that 400,000 working-age Americans died in excess of what was anticipated pre-pandemic.
State of play:
Compared to pre-pandemic projections, there are around 3.5 million people effectively missing from the American workforce, as Powell explained
in that speech at the Brookings Institution
number includes older workers who left the labor force earlier than
expected. "These excess retirements might now account for more than 2
million of the ... shortfall," he said.
- The other 1.5 million comes from a decline in immigration and "a surge in deaths."
- Overall, 1.09 million Americans lost their lives to COVID-19, according to Johns Hopkins data.
💭 Our thought bubble: The role these deaths play in the economy often gets overlooked, possibly because it's so devastating to contemplate.
- But when considering the state of the U.S. workplace,
it's worth remembering that many Americans lost colleagues, friends and
loved ones over the past few years. It's a toll that will take many
years to understand and lifetimes to grieve.