Despite shedding a whopping 20.5 million payrolls and unemployment soaring to 14.7% in April, the U. S. labor market saw one worker category spike that gives hope for a quick economic recovery.
“If you do want to find a silver lining within the data, almost all of the increase in people that lost their jobs believe that the layoff is temporary at this point, about 97%,” Matthew Luzzetti, U. S. chief economist at Deutsche Bank tells Yahoo Finance. ”If that proves to be accurate, it is a positive sign.”
The number of unemployed people who reported being on a temporary layoff, according to the Bureau of Labor Statistics’ household survey, increased to 18.1 million in April from just 1.8 million in March and 801,000 in February. In other words, most of these workers expect to get their old jobs back.
“In a normal recession, nearly all the unemployed are permanent job losers,” Paul Ashworth, chief economist at Capital Economics notes. “Admittedly, temporary layoffs may still turn into permanent job losses. But, for now at least, the hope is that this means the unemployment rate will fall back much more quickly than normal, as the lockdowns are eased.”