What ZipRecruiter Sees for the Economy's Eventual Rebound
Sam primarily covers entertainment and media for dot.LA. Previously he was Marjorie Deane Fellow at The Economist, where he wrote for the business and finance sections of the print edition. He has also worked at the XPRIZE Foundation, U.S. Government Accountability Office, KCRW, and MLB Advanced Media (now Disney Streaming Services). He holds an MBA from UCLA Anderson, an MPP from UCLA Luskin and a BA in History from University of Michigan. Email him at samblake@dot.LA and find him on Twitter @hisamblake
As regions nationwide steel themselves for the oncoming peaks of COVID-19 cases, the U.S. economy continues to stumble. But some emerging patterns suggest certain changes once it stabilizes.
For now, JPMorgan economists forecasted this week a 40% annualized decline in U.S. GDP for the second quarter, and a 20% surge in April's unemployment rate, with 25 million jobs lost. The number of people seeking unemployment benefits in the past three weeks totals 16.8 million.
What could be in store once the economy rebounds?
As a tech-savvy online jobs marketplace, ZipRecruiter has a unique vantage point to monitor and forecast the labor market. Labor economist Julia Pollak spoke with dot.LA about what the latest batch of data signals for the other side of the crisis.
Show Me the Data
"This recession is like no other we've experienced," said Pollak. "People are calling this the Great Cessation."
Some people "will find that during the recovery the economy will have changed beneath their feet."
There is no sugarcoating the gloom. According to figures ZipRecruiter provided to dot.LA, average daily job postings across the internet have been declining for six straight weeks; worse, the rate of decline has been accelerating. In all but four of the 27 industries that ZipRecruiter tracks, job postings have plunged between the weeks ending March 8th through April 5th.
Travel (-51%) and tourism (-31%) have been hit hardest. So have states dependent on these industries, like Hawaii (-25%) and Nevada (-24%). These states and sectors are highly sensitive to nationwide trends, noted Pollak, meaning once things start to rebound, they should see relatively quick recoveries.
Conversely, some job postings are growing fast. These include jobs* in:
- Transportation: Commercial Flatbed Truck Driver postings are +2,614% over the past four weeks; Truck Driver Trainer +634%
- Storage: Warehouse Laborer +83%, Warehouse Sorter +62%
- Finance and Insurance: Claims Adjuster +212%, Financial Sales +93%
- E-commerce: Distribution Associate +232%, Grocery Shopper +17%
- Healthcare and Social Assistance: Intensive Care Nurse +188%, Nursing Assistant +184%
The best predictor of future behavior...
As for what these foretell regarding the future economic contours, Pollak suggests also looking at past trends.
"All kinds of slow, gradual transformations that we were seeing in the economy before are now going to happen very quickly," she forecasted.
This includes the decline of certain industries, like manufacturing and retail. "Stores will go into bankruptcy much sooner than they might have," noted Pollak.
Other industries are likely to continue their ascent. "The healthcare sector has added 278,000 jobs each year on average over the past 10 years," said Pollak. Expect more growth, especially given pent-up demand for elective procedures (assuming age demographic trends mostly hold).
Meanwhile, workers and consumers are acclimating to formerly peripheral activities now becoming mainstream.
"Some of the growth that's occurring now in e-commerce, distance learning and telemedicine will be permanent," Pollak predicted.
Throughout the economy, "people are learning new technologies (and) interacting with new goods and services that they hadn't used before. And some are enjoying the experience."
Fitter, Happier, More Productive
Firms, too, are adapting to new ways of doing business, which could mean increased productivity in the long run. "Companies have been forced to invest in all kinds of technology that may have been available and would have resulted in huge cost savings, and didn't (invest) because of inertia, but now that they've become familiar (with these technologies) they'll use them to great benefit," noted Pollak.
Reducing headcount, though often painful (and sometimes unceremonious), may also ultimately make companies healthier.
"People get confused when the stock market goes up despite people losing their jobs," tweeted former Presidential candidate Andrew Yang on Thursday. "The truth is that many companies will be more profitable and efficient with fewer employees."
As working from home becomes commonplace, companies will be able to reduce land costs; and those unit costs will likely be cheaper. Some studies suggest a distributed workforce may increase productivity.
Workers on the low-end of the earnings distribution may become more productive, too.
Pollak has found that the federal aid package, combined with unemployment benefits, has left nearly half of all American workers at least as well paid as they were before the pandemic--albeit temporarily. "This offers an opportunity for many low-wage workers to overcome barriers they had to higher-wage employment in better jobs before," she said. There is no guarantee such workers will seize that opportunity, but many now have the time and financial support to train for skills, certificates and licenses that were previously out of reach.
The big question is the extent to which the damage done to the labor market overmatches the positive trends--and how long it will take to close that gap. The longer the health crisis lasts, the worse the problem will become so long as net jobs continue to decline.
In the meantime, actions like those taken by the Fed and Congress will buy the economy time, in hopes of hastening what ZipRecruiter Chief Executive Officer Ian Siegel called the "great American comeback story to come."
- paycheck-protection-program - dot.LA ›
- ziprecruiter - dot.LA ›
- What ZipRecruiter Sees for the Economy's Eventual Rebound - dot.LA ›
- U.S. Has Entered Recession, UCLA Economists Predict - dot.LA ›
- montgomery-summit - dot.LA ›
- Could Coronavirus Push the U.S. Economy Into a Recession? ›
- Coronavirus Updates: Bars, Gyms and Theaters Close Countywide - dot.LA ›
- NBCUniversal Lets Peacock Loose - dot.LA ›
- UCLA Anderson Finds it Will Take 3 Years to Recover from COVID-19 - dot.LA ›
Subscribe to our newsletter to catch every headline.
dot.LA hosted its first virtual pitch showcase on Thursday featuring three emerging companies that will have a positive impact on the current COVID-19 crisis. Founding entrepreneurs from Flowly, Shared Harvest Fund, and Meal Share talked through their business plans, shared decks, and explained their market strategy,
Anna Barber is an Investor, advisor, connector and coach for founders at Techstars LA and The Fund LA.
Spencer Rascoff is the cofounder of dot.LA
- Startups - dot.LA ›
- Join Us For dot.LA's Startup Pitch Showcase - dot.LA ›
- Los Angeles' Tech and Startup Scene is Growing. - dot.LA ›
- los-angeles-startups - dot.LA ›
- Top 50 Hottest Los Angeles Startups ›
Join us at 11:00 a.m. PST August 4th for the next dot.LA Strategy Session on "The Future of Sports."
The Rams and Chargers are set to play in a brand new $5.5 billion stadium in Inglewood this season that is being billed as the most technologically advanced in the world. Meanwhile, Dodger Stadium just completed a $100 million update and L.A. will be getting a new pro women's soccer team, Angel City, in 2022 backed by high profile VC's and celebrities.
Julie Uhrman, Founder and President at WFC LA (Angel City)
Julie Uhrman, Founder and President at WFC LA (Angel City)<p>Founder and president of Angel City, the consortium who received the rights from the NWSL to officially bring a women's soccer team to Los Angeles in 2022. </p><p>Uhrman was named head of media at Playboy in 2018 after serving as Lionsgate's GM of over-the-top ventures, overseeing the company's Tribeca Shortlist, Comic-Con HQ, Laugh Out Loud in partnership with Kevin Hart and Pantaya. </p><p>Prior to joining Lionsgate, Uhrman worked at VR vendor Jaunt as head of platform business development. She was the founder and CEO of OUYA, an Android-based game console for living room, which raised $8.6 million through Kickstarter and then went on to secure venture funding from Kleiner Perkins and Alibaba before the company was acquired by Razer in 2015. Previously Uhrman held executive roles in digital and game companies including IGN Entertainment and Vivendi Universal.</p>
Kevin Demoff, Chief Operating Officer at Los Angeles Rams
Kevin Demoff, Chief Operating Officer at Los Angeles Rams<p>Kevin Demoff is in his 11th year as chief operating officer with the Rams. In this capacity, Demoff serves as the team's top front office executive and liaison to owner and chairman, Stan Kroenke, on all organizational matters.</p><p>Demoff was recognized by the Sports Business Journal as one of its "Forty under 40" class members of 2016 and in 2010 he was named one of the "NFL's 10 Future Power Brokers" by Sports Illustrated.</p><p>Prior to joining the Rams, Demoff spent the previous four seasons (2005-08) with the Tampa Bay Buccaneers, where he served as a consultant before being named senior assistant in 2006. In this capacity, Demoff assisted General Manager Bruce Allen in contract negotiations, salary cap management, strategic planning and both college and pro scouting. During his tenure with the Buccaneers, the team captured NFC South titles in 2005 and 2007 while posting a winning record in three of his four seasons.</p>
Ben Bergman, Senior Reporter at dot.LA
Ben Bergman, Senior Reporter at dot.LA<p>Ben Bergman is the newsroom's senior reporter, covering venture capital. Previously he was a senior reporter/host at KPCC, a producer at Gimlet Media and NPR and produced two investigative documentaries for KCET. He has been a frequent on-air contributor to NPR and Marketplace and has written for The New York Times. Bergman was a 2017-2018 Knight-Bagehot Fellow in Economic and Business Journalism at Columbia Business School. He enjoys skiing, playing poker, and cheering on The Seattle Seahawks.</p>
- Kobe Bryant Remembered as Venture Capitalist in L.A. - dot.LA ›
- More Sports Video App Aims to Bring NBA to China - dot.LA ›