The nature of U.S. unemployment is changing, as it becomes clear that several sectors of the U.S. economy will not be returning all their workers back to work.
The U.S. Department of Labor’s Bureau of Labor Statistics reports that in August 2019, 6.2 million workers were officially considered to be unemployed; of these 32.9% had been unemployed for 15 weeks or more. In August 2020, the BLS reports 13.7 million workers were considered to be unemployed (a vast understatement); of these, 58.3% were unemployed for 15 weeks or more, almost double the situation of August 2019.
The permanent closures in sections of the U.S. economy indicates that some of these workers will not be called back to work. American Airlines and United Airlines indicated that they could “temporarily” lay off 32,000 workers unless the U.S. government provides a $25 billion support/bailout of the airline industry, a repeat of the $25 billion that the Congress supplied under the CARES Act earlier this year, and which is now expiring. But Congress has not come up with the legislation that would authorize this, so the layoffs may soon begin. It is difficult to know if some of these workers will be called back to work, as the airline industry has been slashing its workforce for years.
Since 2012 the airlines have wasted $45 billion in buying back their own stock to prop up their share price. The United States indispensably needs an airline grid, but should it lend $25 billion to companies which might use some of it to prop up their stock? This may be a case for Lyndon LaRouche’s method of bankruptcy reorganization: putting companies through bankruptcy, with the intent of bringing them out of bankruptcy as strong, functioning industries that help develop the physical economy.
