Since the beginning of the coronavirus pandemic, state policymakers have wrestled with the great challenge of navigating a public health crisis without devastating local economies and jobs. Now, nearly nine months into the pandemic, SPN’s new State Job Report shows that while states are adding back some jobs lost during the pandemic, there’s still ground to make up to get states back to pre-pandemic employment numbers.
Recent polling shows that, for many Americans, the health of the economy is just as important as the health of the public. Polling from Heart+Mind Strategies shows that, as of mid-November 2020, less than one-third believe the economy is in good or excellent shape, and 50 percent of Americans want to make sure we are balancing our focus between the economy and public health.
The good news is states are, on net, adding jobs back. The challenge for states now is to get back to pre-pandemic job levels and to foster an economic environment that expands job creation even beyond this recovery. SPN’s State Job Report makes it easy for states to track their progress back to pre-pandemic job numbers.
As of October 2020, every single state has fewer payroll jobs than they did in January 2020, before the coronavirus pandemic and subsequent restrictions struck.
Before the pandemic, state policymakers’ focus related to jobs was to create a healthy business climate and learn from and compete with other states to drive job creation in their own cities and towns. At the initial outbreak of coronavirus, crisis mode struck local economies just as much as it did the healthcare sector. People inevitably changed their work and consumption patterns to avoid getting sick and to slow the virus’s spread. State policymakers’ focus shifted, too, as economic growth took a backseat to simply minimizing job losses during the implementation of stay-at-home orders, lockdowns, and other measures.
Despite these efforts to make sure people had jobs to continue or to go back to, research shows state-ordered blanket shutdowns of “non-essential” businesses and stay-at-home orders exacerbated the degree of job loss in many states. Different researchers have different levels of economic damage caused by the lockdown policies:
State-level policy is undoubtedly one of the key factors in job loss and recovery. States with more stringent stay-at-home orders and restrictions on “non-essential” businesses have sustained markedly worse job losses. If New York’s record on protecting jobs was the same as Florida’s, there would be 550,000 more jobs in the Empire State. Michigan imposed more stringent restrictions than neighbors like Ohio and Indiana, and it has sustained far greater job losses. North Carolina and Georgia are nearly the same size, but for every two jobs still lost in Georgia, three are still lost in North Carolina.
Fortunately, there are steps state leaders can take now to address the job losses tallied in their state’s job report.
While federal economic policy can also be a driver of recovery, with these solutions state policymakers don’t have to wait on Washington, DC, to resolve the economic pain and uncertainty Americans feel. Despite Congress’ repeated negotiations to send money to states, policymakers should not assume the federal government will send additional cash to states; instead, states have a window now to encourage local economic growth and preserve core services by prioritizing their expenditures. These steps will lead to balanced budgets, minimal disruption to core services, and the opportunities that businesses, families, and individuals need to help state economies recover.