Regional President Speech

Home / News / Speeches / Thomas I Barkin / 2020 We know the numbers are bleak: 21 million Americans are unemployed, and the number of people who are not working and not actively looking for work (which means they’re not o�cially counted as “unemployed”) has risen by an additional 8.3 million in two months. Retail sales of consumer goods have fallen by almost 23 percent, manufacturing production has dropped over 18 percent, and GDP was down at a 5 percent annual rate in the �rst quarter. Forecasters expect this quarter to be much worse. We also know that the e�ects of the crisis have not been felt evenly. Most distressingly, people of color have disproportionately fallen victim to the virus, and they’ve also been more likely to face job loss — underscoring historic fault lines in our society that are painfully tangible at present. With a broader lens, pre-COVID-19, we were seeing job market polarization: Loss of middle income jobs and increases in jobs at the extremes of the wage scale. The job losses in this crisis are centered on the low end of that “barbell” — service jobs which are disproportionately held by women and those with less education. For the tens of millions of people who have lost their jobs, uncertainty is high. Will they be called back to their former places of employment? If not, what jobs will be available to them? Will the industries in which they’ve been trained continue to exist at the scale they did in the past — or continue to exist at all? But even those who remain employed face challenges. First and foremost, the essential front-line workers who provide us with vital services, especially health care, do so at great personal risk and emotional toll. Workers with families also are under immense strain right now. I hear this every day in conversations with our Bank’s employees, many of whom have young kids at home and are struggling to balance work and home. The challenges are di�erent, but no less real, for families taking care of elderly parents. Over the past two months, we’ve seen disproportionate drops in workforce participation among groups that had been trending upward, such as prime age women and those age 55 and over. Care responsibilities, at a time when child care and schools are closed and elder care facilities are perceived to be less safe, can make it di�cult to work. And perhaps baby boomers are leaving the workforce given the increased health risk they perceive. Legislators and monetary policymakers have taken extraordinary steps to support the health of our economy. But if we are going to get to the other side of this crisis, we have to be thinking about the longer-term changes that will enable our economy to recover — and give more people a shot at participating when it does. We need aggressive and consistent workplace health protection protocols. These are critical for essential workers, who deserve our full protection. They are critical to convince displaced workers it is safe to come back. And they are critical to make consumers feel safe when they visit a store or a restaurant. De�ning those standards and ensuring they are broadly followed will require strong public-private coordination. It’s possible we will see some drop in productivity in the short term as we stand up the processes and practices to make this possible, but if the protocols are clear and consistent, businesses will redesign their operations to regain productivity in the medium term. And longer term, they may even see dividends in the form of a healthier workforce with less absenteeism. We need to focus on workforce redeployment. I’m intrigued by the rapid development of widespread online education. Perhaps states will �nd that they can deploy online tools to retrain large numbers of unemployed people for industries that are hiring, at low cost and price. That of course would require expansion of access to broadband. We also have a real opportunity to bolster our community colleges, which play a crucial role standing up training programs for in-demand careers and bringing employers and workers together. Both schools and students need funding, especially in the current environment, and one way to help would be to allow federal and state �nancial aid to be used for workforce credential programs. We need well-functioning child care and elder care. But both of these industries are at risk. Given that the cost of providing high-quality child care is far more than the majority of families can pay for, there is probably no getting around expanding public and/or private investment in early childhood education and child care. Elder care industries — both nursing homes and in-home care — must �nd a way to assure families that they can operate safely, without undue risk to the health of our seniors. With an aging population and millions of working families dependent on child care in order to work, we need to �nd ways to make these business models safe, sustainable, and a�ordable. The health of our workers matters. The ability of those displaced by this crisis to �nd their next career matters. And giving those who want and need to work the support they need matters. To return our economy to its full potential, we need well-designed e�orts to address these critical foundations. Employment and Labor Markets Workforce Development Economic Inequality and Poverty Receive an email noti�cation when News is posted online: By submitting this form you agree to the Email Address Subscribe (804) 697-8956 (804) 332-0207 (mobile) © 1997-2024 Federal Reserve Bank of Richmond

Tom Barkin (2020, June 14). Regional President Speech. Speeches, Federal Reserve. https://whenthefedspeaks.com/doc/regional_speeche_20200615_tom_barkin

@misc{wtfs_regional_speeche_20200615_tom_barkin,
  author = {Tom Barkin},
  title = {Regional President Speech},
  year = {2020},
  month = {Jun},
  howpublished = {Speeches, Federal Reserve},
  url = {https://whenthefedspeaks.com/doc/regional_speeche_20200615_tom_barkin},
  note = {Retrieved via When the Fed Speaks corpus}
}