Coronavirus sparks new wave of early retirement, study reveals
In a new paper from the National Bureau of Economic Research, economists note that the job losses are far higher than the official figures represent and that many people who are jobless aren’t looking for new jobs, due to early retirement. Yahoo Finance’s Sibile Marcellus joins Seana Smith to discuss.
Video Transcript
- Welcome back. Now, the coronavirus is disrupting the labor market with more than 26 million Americans filing for unemployment. For more on this, I want to bring in Sibile Marcellus. And Sibile, I know you're focusing on the fact that so many jobs are being lost over the last several weeks. And it actually could be forcing early retirement.
SIBILE MARCELLUS: That's right, Shauna. So a significant number of people who lost their jobs over the past couple of weeks have retired early, thus dropping out of the US labor force. Now, what this new report by the National Bureau of Economic Research shows is that, as bad as the unemployment numbers have been, in reality, they're likely much worse in what's going to be reflected in the official unemployment rate. And the way they've figured that out is because they look at the employment-to-population ratio. That's gone down by 7.5 percentage points. Total US adult population, 260 million. That means that, as of April 6h, nearly 20 million jobs have been lost.
That should reflect unemployment rate of 16%. But because of the way the Bureau of Labor Statistics calculates the unemployment rate, it will likely only go up by two percentage points. We're all going to be paying very close attention to the March jobs report when that comes out next week.
- And Sibile, when we talk about, really, the ramifications of this, obviously, people are being forced into retirement early. But also, there could be a backlog here. So we could see millions of more Americans really file for unemployment. Because many still aren't even able to successfully file for the claims that they want to at this point.
SIBILE MARCELLUS: That's right. We've seen, across the country, websites crashing, long lines at unemployment offices. So it's been a struggle. And we can expect that the unemployment claims number will continue to go up over the next couple weeks.
- All right, thanks so much, Sibile.
