QCEW figures show we still had a lot of service jobs to fill after COVID Winter

As Summer winds down and we continue to add jobs, we can think that everything is relatively back to normal in Wisconsin’s job market. But a recent report should remind us that things are not normal, and that we are still dealing with a quite different market than the one we had at the start of 2020, with a sizable amount of jobs in some areas yet to come back.

The “gold standard” Quarterly Census on Employment and Wages (QCEW) had its full data set for Q1 2021 released on Sept. 1, going over the 12 months between March 2020 and March 2021. That’s a key endpoint, as this was when COVID-19 vaccine was starting to be widespread, and cases were falling after a brutal winter. It also marked 1 year after COVID-19 started to hit the economy, and it gives a good indication on how far we had to go at that time.

Nationwide, there were clear differences in job change between states that were more likely to have COVID restrictions in March 2021, and many southern/rural states that didn’t have so many restrictions at the time.

Now, whether that’s a sign the southern/rural states were winning or losing in their economic strategy during the COVID era? I’ll leave that up to you, but I don't think those places are winning in any fashion these days.

You can see that Wisconsin wasn’t as far back as most the other Midwestern states (only Iowa and Indiana had smaller losses by March), and that the US in total was in a bigger jobs hole than we were.

Change in all jobs, QCEW Mar 2020-Mar 2021
US -6,609,296 (-4.5%)
Wis. -106,280 (-3.7%)

In the 4 months measured since then, the (seasonally adjusted) jobs totals have the US gaining 2,764,000 jobs, so a little more than 40% of the gap that existed in March 2021. Wisconsin’s rate of add-back has been slightly less, with 35,800 jobs added (just over 1/3 of the losses), but given that we weren’t as far down, that’s to be expected.

That means we still have quite a ways to go to return to that March 2020 level of employment, and some industries have longer to go than others. Dig into the QCEW Wisconsin figures, and it reminds you of how uneven the job losses were.

And there were major differences within Wisconsin counties as well. 7 of 72 counties actually added jobs over those 12 months, but 10 counties were still down 5% or more in March. And both ends of the spectrum were widely dispersed throughout the state.

Those huge losses in Leisure and Hospitality were even larger in the state’s most-populated metro areas, with the 2 most-populated counties losing more than 1/4 of their jobs in that sector.

While sports fans and hotel guests have returned to places like Milwaukee, Madison and Green Bay, that doesn’t mean everyone is back, or that a lot of businesses that were shut down in March 2021 have come back and/or been replaced. Just like me, I’m sure you can name quite a few places in your community that were casualties of the pandemic, even with aid coming from state and federal sources to try to keep them afloat.

The last jobs to gain back are going to likely be the most difficult. From a demographic side, there are a whole lot of excess deaths complicating the situation (both in lowering the number of potential workers, and in the amount of demand that would be out there to encourage hiring). And like we’ve consistently seen over the last 30 years, once a business lays off workers, they aren’t as quick to hire them back, or get the workers to come back. Even as business comes back.

However, a key difference in late 2021 is that many workers aren’t willing to put themselves back in those lower-paying service jobs and other positions that deal with the public (and therefore increase exposure to COVID), at least at the same rates of pay they were given before. And that also helps explain how we can have these shortages of staff despite a big job hole, because while demand may be back to pre-COVID levels in a lot of sectors, it’s not the same world that we had at the start of 2020.

Now throw in the COVID spike that hit in August and the issues that Wisconsin schools have had in filling teaching and school bus driver positions, and you have a lot of variables that are changing the job market and typical September operations.

Lots to ride out here, and I’d be a fool to try to predict what it means for what kind of job growth we might have for last 4 months of 2021, and in which sectors.