Iowa State researchers say unemployment rate may be higher than reported
CEDAR RAPIDS, Iowa (KCRG) - Researchers at Iowa State University said the unemployment numbers caused by coronavirus may be worse than reported. The national unemployment rate currently sits at 10.2 percent.
Researchers said the unemployment rate could be high as 15 percent. That’s because the Bureau of Labor Statistics doesn’t include people who said they want to work, but are currently not working or looking for work.
They say there could be several reasons. People could be concerned to work because of the virus, they’re taking care of family, or simply didn’t think there were any jobs out there. Researchers said some of them were still able to get unemployment benefits.
“Those people who lost a job but are not looking, they’re not going to be counted by the BLS in this official unemployment measure as being unemployed,” said John Winters, Associate Professor of Economics at Iowa State University. “They’re going to be considered out of the labor force. So if you’re not looking, you’re not working, you’re out of the labor force. But again these are people who in normal times would be working, people in February who were working.”
The study also shows unemployment hitting the Black and Hispanic communities hard. It's also affecting young adults between the ages of 16-24.
Researchers said retail stores and restaurants, where many young people work, were hit hard during the pandemic. They also say companies will sometimes get rid of young people first when they downsize.
“Part of the thing with young people, is they have higher turnover anyway,” said Winters. “So if you have a 35-year-old worker who has been with the company for five years, you may rightly think well if we can just get through this 6-12 months, this worker will still be with us in 6-12 months.”
Winters said the best way to get the unemployment rate back on track is to defeat the coronavirus pandemic.
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