COVID-19: Employment Across Industries

COVID-19: Employment Across Industries

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INSIGHTi
COVID-19: Employment Across Industries
January 5, 2021
The nature of the Coronavirus Disease 2019 (COVID-19) pandemic has caused differing economic
outcomes across industries. Certain industries, such as those that require in-person contact, have been
affected more than others by stay-at-home orders, social distancing mandates, and fears of the virus. This
Insight discusses which industries have been hardest hit by the pandemic. For the overal economic
effects of the pandemic, see CRS Report R46606, COVID-19 and the U.S. Economy, by Lida R.
Weinstock.
Employment Situation
Total nonfarm employment decreased rapidly during the initial months of the COVID-19 pandemic and
hit a low of 130 mil ion employees in April, as shown in Figure 1. The employment situation has
improved since April but remains worse than before the pandemic began, with approximately 143 mil ion
employed individuals in November as compared to 152 mil ion in February.
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Figure 1. Total Nonfarm Employment During COVID-19 Pandemic

Source: Bureau of Labor Statistics, Current Employment Survey (CES).
Note: Data seasonal y adjusted.
Sector-Level Patterns
As categorized by the Bureau of Labor Statistics, there are nine “super sectors” in the economy, which
have al been affected uniquely by the pandemic. Figure 2 and Figure 3 show job losses in each sector.
The blue bars represent job losses in the first three months of the pandemic (February through April),
when unemployment peaked in al but two sectors, while the orange bars represent losses over the more
extended period from February to November. Most sectors lost a significant amount of jobs in the early
months of the pandemic but have since recovered somewhat (represented by the difference between the
blue and orange bars in the figures). The mining and logging and the government sectors were the only
two not to recover. Both sectors experienced further job loss after April.
The leisure and hospitality sector experienced the most job loss not only as an absolute number of
employees but also by the proportion of employees lost. The unemployment rate in this sector was 15% as
of November, wel above the national rate. Uneven as job loss was across sectors, al sectors showed
some level of job loss over both time frames, il ustrating the widespread effects of the pandemic.

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Figure 2. Employment Loss by Sector

Source: CRS calculations using data from CES.
Note: Underlying data seasonal y adjusted.
Figure 3. Percent Loss in Employment by Sector

Source: CRS calculations using data from CES.
Note: Underlying data seasonal y adjusted.
Industry-Level Patterns
Each of the sectors shown above is composed of a series of industries. While the leisure and hospitality
sector showed significantly higher job loss than other sectors, both in the immediate shock of the public
health crisis and over its course in 2020, this does not mean that only industries within this sector have
been hard hit by the COVID-19 pandemic. This section discusses industry-level employment outcomes.

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Employment
Figure 4 shows the top 10 industries (out of 77 at the three-digit NAICS code level) with the greatest loss
of employment between February and November, again represented by the orange bars in the figure. (The
blue bars represent the job losses between February and April.) Both in terms of immediate and longer-
term impact, the food services and drinking places industry has suffered significantly more employment
loss than others. By November, this industry had lost over 2 mil ion employees since February, about 1.4
mil ion more than the next hardest-hit industry (administrative and support services).
Food services and drinking places did recover a significant amount of jobs—roughly 4 mil ion—between
April and November. Other industries—such as the motion picture and sound recording industries, local
government, and nursing and residential care facilities—lost fewer jobs in an absolute sense through April
than the food services and drinking places industry but saw minimal recovery by November. Nursing and
residential care facilities continued to lose jobs between April and November.
Figure 4. 10 Hardest-Hit Industries by Employment Loss, November 2020

Source: CRS calculations using data from CES.
Note: Underlying data seasonal y adjusted.
When looking at the proportional decline in employment during the pandemic, as measured by percent
change in employment, the story changes somewhat. For example, the food services and drinking places
industry is not among the hardest-hit industries by percent loss of employment as of November, despite a
significant percent loss in April. This indicates that, despite the relative large absolute job loss in this
industry as of November, the industry is large enough that the proportional loss was relatively smal er
than other hard-hit industries shown in Figure 5. It is possible that this industry could see more losses this
winter as colder weather makes outdoor dining options less feasible and increasing caseloads prompt
mandates forbidding indoor dining.
Two of the three hardest-hit industries—performing arts and spectator sports and accommodation—are in
the leisure and hospitality sector, in part explaining why this sector showed the highest percent loss in
employment. Several industries in Figure 5 are part of the trade, transportation, and utilities sector,
underscoring the fact that individual industries across sectors have been relatively hard hit. Additional y,
the differences in results between Figure 4 and Figure 5 show that the employment loss in some

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industries may have been smal er in absolute terms, but relative to the size of the industry, the loss may
have been significant. In this sense, it may be important to look at more than one measurement of
employment loss to determine which industries have suffered the most during the pandemic.
Figure 5. 10 Hardest-Hit Industries by Percent Employment Loss, November 2020

Source: CRS calculations using data from CES.
Note: Underlying data seasonal y adjusted.
Policy Implications
Despite the severity of the employment losses seen in these sectors, the employment situation may have
been improved in the short term by policies aimed at maintaining payroll, such as the Paycheck Protection
Program (PPP). On December 27, 2020, President Trump signed H.R. 133, which included an extension
of the PPP and other fiscal stimulus that could affect employment in 2021.

Author Information

Lida R. Weinstock

Analyst in Macroeconomic Policy

Disclaimer
This document was prepared by the Congressional Research Service (CRS). CRS serves as nonpartisan shared staff
to congressional committees and Members of Congress. It operates solely at the behest of and under the direction of
Congress. Information in a CRS Report should not be relied upon for purposes other than public understanding of

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information that has been provided by CRS to Members of Congress in connection with CRS’s institutional role.
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