26 million job losses prove a sad fact about American businesses — and American people

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Eric Lewis
New York
2 days ago

Welcome to the twilight of late capitalism. The shutdown has now been ongoing, erratically and incompletely, for about six weeks in the United States. In the last five weeks, around 26 million people have lost their jobs. That is a numbingly huge number, equivalent to about 23 per cent unemployment which is comparable to the Great Depression. No doubt many of those workers worked for their employers loyally for many years, often for low wages; the federal minimum wage is still $7.25 per hour. That loyalty was not reciprocated. It rarely is.

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These 26 million newly unemployed do not include workers working fewer hours or taking salary reductions. In less than a month, a huge chunk of the workforce finds itself out in the street — or at least closer to it. To the extent that employers actually provided the 26 million with some health insurance — a rare enough event — that coverage will be gone, unless workers can afford to continue that coverage with their unemployment benefits or limited savings. So millions of people now not only have no job and no income, they have no ability to take care of the health needs of their families in a time of pandemic.

What is remarkable is how quickly the bonds of employer and employee are severed in the American economy. To economists, this shows the “efficiency” and “flexibility” of our labor markets. Unlike in Europe, workers are hired and fired rapidly so there is no friction for employers who want to shed workers. To real people, it shows that between employer and employee it is all, in the words of the Godfather, “strictly business.”

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