US labour market policies need to focus on addressing inequalities in the market – leading macroeconomic influencers

15 October 2020 (Last Updated October 16th, 2020 09:59)

US labour market policies need to focus on addressing inequalities in the market – leading macroeconomic influencers
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The inequalities that existed in the US labour market have now been exacerbated amid the Covid-19 pandemic. Robust labour market policies need to be formulated to address these inequalities. Macroeconomic influencers share their views on the Covid-19 impact.

Larry Mishel

Larry Mishel, an economist, shared an article on how the Covid-19 pandemic is exacerbating the already existing labour market inequalities in the US. According to the latest report from the US Bureau of Labor Statistics (BLS), more people were found to be leaving the work force than jobs being created by employers.

Further, new jobs being created were lower than the previous months and permanent layoffs were increasing with 3.7 million workers being permanently laid off. Several firms including Disney, United Airlines, Wells Fargo, and Salesforce have announced permanent layoffs.

The article noted that the pandemic is unevenly impacting different groups of workers particularly black people, older workers and women. Issues such as low wages, access to good jobs and retirement policies need to be addressed, the article noted.

Howard Archer

Howard Archer, Chief Economic Advisor to EY ITEM Club, shared an article on comments made by the Organisation for Economic Co-operation and Development (OECD) that the UK should focus more on the unemployment issue in the country rather than public finances.

The UK economy is projected to shrink by 10.1% in 2020 before growing by 7.6% in 2021. The tightening of restrictions imposed due to the coronavirus pandemic, however, is expected to further slowdown the economy.

The OECD recommends that the UK government should implement measures to help unemployed workers find jobs and later focus on the structural deficit. The organisation also noted that tax breaks for individuals and businesses should be reduced and property taxes on wealthy homes should be increased.

The OECD further added that the UK should strike broader trade deals across the world to reduce the impact caused by Brexit.

Prof. Steve Hanke

Prof. Steve Hanke, economist at Johns Hopkins University, shared an article on the fall in Latin American currencies, following J&J’s announcement on pausing its clinical trial on Covid-19 vaccine and the gloomy outlook shared by International Monetary Fund on emerging markets.

Brazil’s real declined the most among Latin American currencies by 1%, followed by the Mexican peso, which fell by 0.1%. The article noted that recovery of emerging markets will be dependent on the availability of Covid-19 vaccine.

James Picerno

James Picerno, editor at US Business Cycle Risk Report, shared an article on the pausing of Eli Lilly’s ACTIV-3 clinical trial on monoclonal antibody treatment for coronavirus by health regulators in the US over safety concerns.

The ACTIV-3 clinical trial was designed to test the monoclonal antibody treatment in combination with antiviral drug remdesivir. It is part of several clinical trials being undertaken by the National Institute of Health’s Activ programme, aimed at accelerating Covid-19 vaccine development.

The monoclonal antibody treatment was developed using blood samples taken from one of the first coronavirus patients. Monoclonal antibodies are separated from the blood and designed to act as immune cells against the coronavirus.