Here's why some unemployed workers aren't looking for a new job
As the labor market recovers, the pandemic itself remains the biggest factor preventing workers from getting a job. But rising wages could ultimately bring them back.
According to a Yahoo Finance / Harris Poll of 1,003 US adults conducted October 22-25, 2021, three in ten workers cited Covid-19 fears as the main reason for not looking for a job urgently while financial cushions and caregiving responsibilities were associated with second with 22%.
"Health and safety concerns are still number one on people's minds," Elise Gould, senior economist at the Economic Policy Institute, told Yahoo Money. “More and more jobs require a personal appearance. This is still a major problem for many people who may be living with vulnerable family members or who may be concerned about their own health. "
Understanding worker reluctance is key to bringing the labor market back to pre-pandemic levels. The economy created 531,000 jobs in October, but that's still 4.2 million fewer than in February 2020.
"That would go away pretty quickly"
Thanks to unprecedented government support, many workers have built up a financial cushion during the pandemic that has so far enabled them to be more choosy when choosing a job. But that could soon play a lesser role, Gould said, as much of the pandemic aid has dried up.
"A lot of people have lost unemployment insurance," she said. "All savings families could last, that would go away pretty quickly."
The last round of stimulus payments was sent out in April and the federal unemployment programs expired in early September. Since then, the savings rate has returned to pre-pandemic levels, reaching 7.5% in September after increasing it during the pandemic.
Due diligence is another factor holding workers back, the Yahoo Finance / Harris Poll found. A similar survey by Indeed of 5,000 people found that more people cited caring responsibilities as a reason in October than in the summer.
Gould said childcare shutdowns could be an issue for some families, Gould said, along with unpredictable school schedules.
"There's more in-person training," Nick Bunker, director of research at Indeed, told Yahoo Money. "But there is still some instability with the fact that some children are in quarantine."
"To bring them in, higher wages have to be paid"
A Now Hiring sign hangs near the entrance to a Winn Dixie supermarket in Hallandale, Florida on September 21, 2021. (Photo by Joe Raedle / Getty Images)
According to the survey, around one in eight employees has given up looking for a job.
More than half of the adults (53%) who had looked for a new job in the last six months found the process difficult because they did not receive an answer to their application (36%), did not find their desired salary (36%) or not found the right job (30%).
However, rising wages could convince more workers to take jobs. According to a survey by Yahoo Finance / Harris Poll, two-thirds of workers said low pay is the number one reason a job posting is not attractive to them.
Total wages have risen 4.9% in the past 12 months, with wages in the leisure and hospitality industries increasing 11.2%, according to the Ministry of Labor.
"It's not that people are just ready to jump straight back into the job market," Bunker said. "In addition, there must be higher wages."
Denitsa is a writer for Yahoo Finance and Cashay, a new personal finance website. Follow her on Twitter @denitsa_tsekova
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