The Fed seemed optimistic at last week’s Federal Open Market Committee Meeting, noting that the country was approaching the “maximum employment” goal set to indicate economic recovery throughout the pandemic. The unemployment rate now sits at a “pandemic low” of 3.9% as the nation moves into the new year. However, Bloomberg recently reported on another statistic that could stunt economic growth amid the spread of the omicron variant: sick days.
An estimated 5 million workers stayed home in the first full week of January due to quarantine or coronavirus symptoms. This followed two weeks of people missing work due to holiday flight cancellations and travel delays as airlines tried to run short-staffed with pilots — and support personnel — out sick or in isolation.
As work schedules return to normal after the holidays, a new wave of absenteeism threatens to disrupt supply chains: factory workers, global transport workers and retail workers calling out sick.
James Beall — CEO of a large Washington, D.C.-based pizza chain, Ledo Pizza — told Bloomberg that on any given day last week, at least three of the company’s 110 locations were closed due to lack of staffing while five more operated on reduced hours.
1 Million COVID-19 Cases in a Single Day Could Indicate Future Labor Woes
The numbers nationwide show this could be the norm, as 1 million new cases of COVID-19 emerged in a single day last week.
Hospitals and healthcare facilities are calling the current situation “the most significant labor shortage that we have ever seen,” per health exec Sally Zuel, as quoted by Bloomberg.
Staffing shortages are also affecting schools, with 383 teachers in Osceola County, Florida, out sick. Fifty teachers in a single Brooklyn, New York, high school also took sick days, leaving hundreds of students to gather in the auditorium for supervision, according to local reports.
If schools are forced to close due to staffing shortages, especially at the primary school levels, parents may have to call out sick to work due to lack of childcare arrangements. This would further exacerbate labor shortages and disrupt supply chains.
The situation has some economists moderating their optimistic outlook for the first quarter of 2022. Mark Zandi, chief economist at Moody’s Analytics, cut his GDP predictions for the first quarter by more than half, downgrading his assessment from 5% growth to 2%, according to Bloomberg. The economist noted that he believes the effects of absenteeism will be short lived but “could affect how the Federal Reserve views the recovery and when it acts to raise rates.”
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