What Does Job Recovery Look Like

COVID-19 sparked one of the deepest downturns in employment in US history. The U.S. Bureau of Labor Statistics Current Employment Statistics survey revealed that payroll employment in the country declined by 9.4 million in 2020. This was the largest calendar-year decline in the history of CES employment.

The industries that suffered the most were typically the ones based on business models involving people coming into close contact with each other (employees as well as customers). The leisure and hospitality industries were among the worst affected.

The unemployment rate reached 3.8 percent in February 2020 to 13 percent in May. The unemployment trade rose higher in just 3 months of COVID, and this figure was substantially greater than the ratio it reached during the Great Recession. Fortunately, the recent employment reports show that the economy has recovered a significant chunk of those lost jobs. Let’s see how this is affecting the overall employment recovery in America.

On-Premises Labor Force Is Making a Return

The key workforce that was furloughed or laid-off by COVID and its variants is returning to conventional workplace models. This workforce included young mothers who had to quit their jobs because of the closure of schools and daycare centers, employees who were laid off, temporary members of the workforce, and the older members of the workforce who took early retirement because of the increased health risks of COVID. Now that schools have reopened, women have returned to the labor force as well.

While payroll growth is not the same as it was pre-pandemic, according to Fitch Ratings, all jobs that were lost at the onset of COVID are expected to be recovered by July of this year. The states that have filled the most employment opportunities that were lost since the onset of COVID include Arkansas, Tennessee, Florida, Indiana, North Carolina, Texas, Montana, Idaho, Utah, South Dakota, Arizona, and Colorado.

Employment Rate Is Gaining Momentum

The demand for the workforce is helping employment recovery across multiple industries. Rapid hiring is lowering prior unemployment levels. This, in turn, is easing labor shortages and eliminating hiring obstacles or constraints. According to the Bureau of Labor Statistics, the US economy added 678,000 jobs in February 2022.

This figure was far higher than what economists had anticipated. The falling number of COVID cases, the back-to-work trend, amplified workplace safety, and most industries regaining jobs, have all contributed to this growth. When the economy exited the Omicron wave, the strength of the labor market was back on full display.

The leisure and hospitality industry, among some of the worst-impacted sectors by Covid-related layoffs, recently added 179,000 jobs. However, to return to pre-pandemic levels, the industry requires another 1.5 million employees. The majority of the jobs produced in February were in restaurants and bars, as Americans returned to normalcy once Omicron subsided. Job growth was also steady in construction, professional services, and health care.

While the labor market hasn’t returned to the same strength levels it was at before the pandemic’s recession, there are certainly signs of positive momentum. If the next reports match February’s rate of job creation, the economy could rebound to pre-pandemic job levels far sooner than expected.

Industries That Are Leading the Pandemic Job Recovery

Some sectors bounced back to the pre-pandemic levels faster than others. These include professional services, transportation and warehousing, retail, financial activities, construction, utilities, and some others. The total number of jobs in America has not yet climbed back to the level it was before the pandemic. For instance, employment levels in the leisure and hospitality industries are still down by 1.4 million.

Since consumers are buying online, warehouses across the United States are experiencing a recruiting boom. The work-from-home economy has raised the demand for driving jobs as well. The demand for data analysts, project managers, software engineers, and other positions in the supply chain industry has increased too.

Additionally, the push to vaccinate people against COVID-19 created new job employment openings at pharmacies and other healthcare facilities.

However, labor demand and labor supply are still out of sync in several industries even today, further compounded by aggressive hiring practices. This is why companies must leverage the right talent acquisition strategies and offer attractive wages and perks to attract the right talent as well as retain them.

Employer Behavior Can Aid in Meeting the Labor Deficit

Employers can play a significant role in encouraging the labor force to return. For instance, companies could consider newer means of navigating the new labor market, as opposed to sticking to pre-pandemic approaches.

Instruments such as remote work can help boost work flexibility and reassure employees about their safety, especially concerning exposure to infected colleagues in the workplace. Regardless of the type of business, be it a mortgage staffing agency or pharmacy, the businesses that fail to adapt to employee expectations may find themselves having to recruit from a far narrower pool of candidates.


As the economic crisis triggered by the COVID-19 pandemic approach its 3rd anniversary, America’s diverse metro areas are at drastically different stages of recovery. The employment disparities between metros that existed prior to the pandemic have widened and distorted in the last two years.

Without a significant national recovery plan and improved hiring agility through models such as decentralized recruitment, while the economy may be recovering, it’s still too early to pass a definitive verdict that America will fully recover anywhere in 2022.

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