Illinois jobs are returning, but not for minority workers
While May’s jobs report showed what could be the beginning of a bounce back in total employment for the state, growth was concentrated primarily among white workers. Black and Hispanic workers were left behind.
Illinois regained 62,200 jobs from mid-April to mid-May, but they were unevenly distributed and minority workers were suffering the most, according to data from the Illinois Department of Employment Security in conjunction with the Bureau of Labor Statistics.
White workers during that time recovered 13% of the jobs lost, but black workers recovered only 2% and Hispanic workers only 1%, according to the Current Population Survey. The rebound has been similar for male and female workers.
Those 62,200 jobs that returned in Illinois represent a gain of 1.2%. However, payrolls still remain far below the pre-COVID levels observed in February and the state’s unemployment rate remains above the national average at 15.2%.
The industries that contributed most to the May jobs growth are also the sectors that were hit hardest by COVID-19 and the state-mandated lockdown that was meant to contain the virus.
The sectors adding the most jobs in May were many of the industries that have experienced the sharpest decline. The leisure and hospitality sector added 30,100 jobs in May, but payrolls are still down 287,300 – 46% below their February level. Other large gains came in the professional and business services industry, which added 16,100 jobs but remains down more than 81,000 positions; manufacturing, which added 14,500 jobs but remains down 37,200 jobs; and construction, which added 11,500 jobs but payrolls for the industry remain 14,800 lower than in February.
While the preliminary data is welcome news, Illinois’ labor market is still in far worse shape than several months ago. At the same time, the rebound in employment that appears to be underway has not impacted all Illinoisans in the same way.
The May numbers are a step in the right direction, but Illinois is still facing a long road to recovery. The evidence suggests most small businesses have less than two months of cash on hand while the median small enterprise has more than $10,000 in monthly bills and less than one month of cash on hand. Illinois’ small businesses are responsible for the majority of Illinois’ job growth. Allowing businesses to open again is an important step to save lives and livelihoods.
Although lifting a lockdown will not restore economic activity to levels observed before the pandemic, research shows the sequential lift of a lockdown is the best way to mitigate both the human cost of the virus and the economic damage. The duration of Illinois’ lockdown and the tight financial situation of many businesses means many of the job losses seen in Illinois run the risk of becoming permanent, and may explain why Illinois’ May jobs growth and the state’s unemployment rate lag the national average.
Further, Illinois voters need to consider the effects of the tax hike state leaders are seeking Nov. 3. Economists argue against increasing taxes during a recession. A progressive income tax will increase taxes up to 47% on more than 100,000 small businesses just as they are trying to recover from the COVID-19 economic damage, and those small businesses are responsible for the vast majority of new jobs in Illinois.
A safe return to work for Illinois families is the first step to tackle growing racial gaps and to revive the Illinois economy. A tax increase would be a misstep.
After more than a century of protests erupting in Illinois and across the country, historians consistently peel back the triggers and factors to find economic injustice at the core. Ignoring the disproportionate costs of a pandemic and the pain in the streets by continuing the same, failed policies is to welcome further human suffering.