The U.S. Economy Is Down Almost 10 Million Jobs a Year Into the Pandemic

While the jobless rate has declined since hitting a peak this past April, the economy is still a long way from a full recovery.

In April, the U.S. unemployment rate reached a record high of 14.7%. By January, that rate had dropped to 6.3%. Based on these numbers alone, it's clear that the joblessness crisis is nowhere near as dire as it was back when the pandemic first erupted.

But still, we can't overlook the fact that there's a lot of work to be done to get the economy back to where it was before the coronavirus outbreak began. In fact, about one year into the pandemic, the economy is still down almost 10 million jobs.

Many of these jobs come from industries that have been notably hard hit during the pandemic, like hotels and restaurants. In fact, one disturbing trend is that as of February, nearly 40% of all unemployed workers had been out of a job for 27 weeks or longer. All told, that's 4 million people who fall into the long-term unemployment category. And these are the people who need as much relief as they can get.

Help is on the way

Given the state of the U.S. economy, it's easy to make the case for more stimulus aid. And that aid is, in fact, on the way.

A $1.9 trillion coronavirus relief bill recently made it through a House vote and now needs Senate approval to pass. The bill includes many months of boosted and extended unemployment benefits. Specifically, jobless workers will be entitled to an extra $400 a week though Aug. 29. And some lawmakers are still fighting to tweak the language of the Senate bill so the unemployment boost stays in place through the end of September instead of expiring in August.

Now the good news is that a federal $400 weekly boost in unemployment benefits will, according to the Department of Labor, replace 86% of the average worker's missing paycheck when combined with regular state benefits. The problem, however, is that a lot of people who are out of work right now may find themselves in that same boat once this latest extension runs dry. What's more, while a $400 weekly boost may compensate for a lot of lost income, the typical worker will still have a 14% shortfall. And given the number of people who were living paycheck to paycheck before the pandemic, that's problematic.

In addition to boosting unemployment benefits, the new relief bill also calls for a round of $1,400 stimulus checks. And these direct payments could begin hitting bank accounts as early as mid-March if lawmakers move quickly on relief legislation. In fact, lawmakers are aiming to get the new relief bill signed into law by March 14 because that's when extended unemployment benefits are set to expire for millions of Americans. To leave those people with any sort of gap in benefits would be, at this stage of the game, downright catastrophic. The good news is that lawmakers may vote on the relief bill as early as this weekend, and once it becomes official, the IRS should send out stimulus funds quickly -- within days of approval if all goes well.