The June jobs number will be released at 8:30 a.m. Thursday, July 2, and economists are expecting the record high unemployment numbers of the last four months to continue.
Ahead of the report, Benzinga caught up with Adam Ozimek, chief economist at Upwork Inc (NASDAQ: UPWK) to preview what to look for in Thursday’s release and how companies are looking to pivot to a more remote workforce into the future.
Look At The Details
Looking forward to Thursday’s national unemployment numbers, Ozimek said that as large numbers of furloughed workers are recalled, job growth can be a misleading statistic.
“What you really want to do is look underneath the headline numbers and see where we see signs of permanent job loss and where do we see signs that indicate businesses that are likely closing,” the economist told Benzinga.
A particular focus should be placed on sectors that may suffer from permanent damage, such as leisure and hospitality, Ozimek said.
Those sectors employ large numbers of low-income workers who may suffer disproportionately, he said.
“Low-income workers have the hardest time finding new work and take the longest time to get rehired.”
Although some temporary furloughed workers are being recalled and the Payment Protection Program is incentivizing rehires, Ozimek said to look for increases in the number of small businesses closing.
When a small business closes, this creates permanent layoffs that are more damaging than a worker being temporarily furloughed, he said.
“When someone gets laid off permanently, now you are dealing with the kind of economic damage that’s associated with a recession and not associated with a temporary shutdown.”
Advantages For Remote Workers In The US
If there’s a silver lining, it’s that Ozimek believes the pandemic will help U.S. workers stand out from their global counterparts.
In the short-term, U.S. skilled workers will be hired from anywhere in the U.S., and that will be a tremendous change in the labor market, the economist said.
Workers now have the opportunity to expand their labor market reach. An earlier analysis by Upwork found that “when faced with the choice of talented remote workers from countries all over the world on a secure and trustworthy platform, the No. 1 country U.S. clients hire from on Upwork is the U.S.”
Ozimek also stressed that skilled service is the United States’ competitive advantage.
U.S. workers will now have the ability to “export their services” both domestically as well as internationally, he said.
Future success will depend on the ability of individuals and companies to pivot Ozimek said.
Ozimek On The Future Of Remote Work
A recent study by Upwork found that 62% of companies report that their organization will be more remote in the future as a result of COVID-19.
A pivot to remote work will occur not only in the U.S., but all over the world, Ozimek said — but it won’t happen equally.
Remote work is not feasible for all workers, and is often dependent on education levels, he said.
62% of workers with a bachelor’s degree or more education have jobs that can be performed remotely, according to a Pew Research study.
"A lot of companies right now are facing a challenge of adapting very quickly to going remote and changing the way they work very quickly," Ozimek said.
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