Non-College Educated Workers Lag in Employment. NewsWire

NEWSWIRE: 5/7/21 

• As hiring picks up again, people with no college degrees are being left behind. In March 2021, only 54.9% of workers with a high school diploma were employed or looking for work. (The Washington Post)
• NH: Last month, 4M workers without college credentials were still unemployed. And only 54.9% of this demographic had a job or was looking for one. Conversely, only 199K workers with a BA were without a job. And as we reported last month, 42% of small businesses said they were struggling to fill open positions.  (See “Small Business Struggle to Fill Jobs.”) 

• So why are people without college degrees disproportionally unemployed? Because many of the jobs available to this demographic pay less than stimulus measures. Remember, the federal government is still paying for an additional $300 of weekly jobless benefits. Peter Gagnon, an economist at the University of Chicago, estimates that 42% of unemployed workers are currently making more money with unemployment insurance than in their previous jobs.  
• If you look at editorials like this one in the WSJ, they are filled with business owners calling the unemployed lazy. But IMO, these workers did the math and are making the best of the current situation--just as a business would.
• But the tilt against work won't last forever. A DC District Court judge just threw out the CDC's eviction moratorium, which (pending appeal) could re-prioritize the need for current income. The extra unemployment insurance will end in September. And by the end of April, 23 states will require those receiving unemployment to prove they are looking for a job. (Many governors had waived this requirement at the beginning of the pandemic.) If people are forced to demonstrate they are actively applying for positions, some will most likely accept offers. Sure, unemployment lasts through September, but that's only four months away, and many may want to get hired before the rush.
• Another major force keeping people home is the continued threat of Covid-19. Many of the jobs available to non-college-educated workers are in the service industry. The very nature of these jobs means workers are physically interacting with consumers. And as of press time, only 33% of the public is fully vaccinated. Of course, some people are choosing to forgo the vaccine. But for many, vaccination appointments have just become available.  
• Looking forward, as vaccination rates inevitably rise and September gets closer, the employment rate for non-college workers is likely to ramp up. That will be good news for all the hiring small business owners. Meanwhile, if they need an employee right away, they had better be prepared to pay a generous wage and provide safe working conditions. And maybe offer an up-front bonus, especially if they agree to get a vaccination right away.