We come upon Labor Day with many Americans still idle. Some were forced off the job by government mandates to close many businesses and stay home in order to reduce personal contact and lower the chances of catching and spreading the deadly COVID-19 virus. As those restrictions are lifted and those businesses reopen, many workers are choosing to stay home. Some are scared away by the continued threats that remain from the global pandemic that has killed millions worldwide. Some are kept away by federal relief checks and moratoriums on housing and other obligations.
As our national economy struggles to get back on track, those benefits undermine many incentives for people to get back to work.
That recovery won’t happen, however, until those people return to the workplace.
Help wanted signs appear everywhere; it seems no industry enjoys full employment. Hardest hit are businesses that rely on unskilled workers who get lower wages, as relief checks reportedly are similar and sometimes even better than their wages before the pandemic.
But when so many people left their jobs, they stopped creating the goods and services the did on those jobs. The result is easily seen in reduced options in automobile and similar markets. The supply of auto parts fell, forcing factories — even those heavily reliant on robots and other automated processes — to cut production. As a result, waiting lists are long and some new vehicles might not be available until next year.
Economists have been warning about inflation for several months, and we are beginning to see prices go up. It’s to be expected; helping people stay afloat by sending them relief checks actually does little to ignite the national economy. Rather, they feed inflation by having more people, with more money, competing for limited amounts of goods and services. As demand increases the value, and cost, of those goods and services increases as well.
We have to build things.
A 2014 report from the U.S. Bureau of Labor Statistics perhaps says it best: “Because, over the long run, productivity growth is the economic factor that has the potential to lead to improved living standards for the participants of the economy — in the form of higher consumption of goods and services.”
The pandemic hit the U.S. hard, although many countries fared worse. Gross domestic product fell from $21.69 trillion in the fourth quarter of 2019 to $19.48 trillion in the second quarter of 2020 — nearly $2 trillion in contraction in half a year, the Commerce Department reports. From that same mark in 2019 through the first quarter of this year, U.S. exports fell by 24.1%, according to the Organisation for Economic Co-operation and Development.
Fortunately, our economy is recovering, having already reached pre-pandemic levels. But that doesn’t account for the growth we might have enjoyed without COVID-19. That can only happen when more people rediscover the satisfaction of a good day’s work and having produced something, and not having to rely on government handouts.