People are ‘long social distancing’ due to COVID-19. Economists say that’s contributing to a drop in labor-force participation.
More than two years after the coronavirus pandemic began, a desire for social distancing is still keeping some people from going back to work. It’s a decision, medical experts say, that everyone must make for themselves, based on their own circumstances. Some economists, however, say that people opting out of work because of the pandemic may also be having an impact on the country’s economic output.
Knowing that COVID-19 has not gone away, some people are not yet prepared to let their guard down, according to a working paper distributed by the National Bureau of Economic Research. Some 13% of U.S. workers said they will continue social distancing as the economy opens up and cases fall, and another 45% said they will do so in limited ways. Only 42% said they plan a “complete return” to the activities they participated in before the pandemic.
The study, titled “Long Social Distancing,” estimated that unwillingness among workers to be in close proximity to others — which in many cases is prudent, especially for those who have underlying conditions or elderly relatives — reduced labor participation by 2.5 percentage points in the first half of 2022 compared with what economists would normally expect to see. That translates to $250 billion in potential annual output, representing a drop of nearly 1 percentage point.
The authors of the report define long social distancing as “persistent behavioral responses to the COVID-19 pandemic, whereby (some) individuals avoid face-to-face encounters in public places, including the workplace and public transit.” The paper was written by Steven J. Davis, a professor at the University of Chicago Booth School of Business; Jose Maria Barrero, a professor of finance at Instituto Tecnologico Autonomo de Mexico; and Nicholas Bloom, a professor of economics at Stanford University. All three are part of WFH Research, a project that looks at the shift to remote working.
Workers still have reason to be concerned about COVID-19. Cases and hospitalizations in the U.S. are on the increase and intensive-care units are filling again, a trend that may signal an end to the stable period the U.S. experienced during the fall months. Many states, including New York, Utah and California, have seen a higher rate of new cases.
The daily average of new cases in the U.S. was up 28% on Monday from two weeks ago, to 53,019, according to a New York Times tracker. The number of daily cases being admitted to intensive-care units rose 21% to 4,136 over the same period, while the number of daily deaths from COVID-19 dropped 11% to 261, according to the newspaper.
New omicron subvariants are quickly replacing earlier ones. The most recent data release from the Centers for Disease Control and Prevention showed that the BQ.1.1 and BQ.1 sublineages of the BA.5 subvariant accounted for 62.8% of all cases in the U.S. in the week through Dec. 3, exceeding the 13.8% of cases caused by BA.5.
“ Those early, fraught months of COVID-19 also provided a rare opportunity for people to re-evaluate the role of work in their lives. ”
Hospitalizations and deaths associated with COVID-19 are substantially higher among unvaccinated adults — particularly adults age 65 and older — than among those who are up to date with their COVID-19 vaccinations, according to the CDC.
Those early, fraught months of COVID-19 — when millions of people were working from home, and hospitals in the U.S. and elsewhere were filling up with coronavirus patients — also provided a rare opportunity for people to re-evaluate the role of work in their lives. And recent layoffs in the tech sector notwithstanding, now many people have leverage: Unemployment is falling and wages are rising as companies struggle to attract and retain workers.
Writing for the Guardian last month, Tedros Adhanom Ghebreyesus, director-general of the World Health Organization, said the world has never been in a better position to end the pandemic that has killed almost 6.5 million people and infected more than 600 million, but he also sounded a cautionary note: Many people around the world are still experiencing “prolonged suffering,” he wrote, with symptoms that linger for months.
“While the pandemic has changed dramatically due to the introduction of many lifesaving tools, and there is light at the end of the tunnel, the impact of long Covid for all countries is very serious and needs immediate and sustained action equivalent to its scale,” Tedros wrote for the newspaper, which recently launched a new series called “Living with long Covid.”
In November, the share of working-age people in the U.S. labor force dropped for the third month in a row. Some 186,000 people left the labor force in November, and the labor-force participation rate ticked down to 62.1% from 62.2% in the previous month, the Bureau of Labor Statistics said Friday. That figure has yet to recover to the February 2020 level of 63.4%.
The authors of the National Bureau of Economic Research report analyzed the results of WFH Research’s monthly Survey of Working Arrangements and Attitudes, which was begun by a group of economists in 2020 in response to the dramatic impact of COVID-19 on working life. The survey polls nearly 27,500 U.S. residents between the ages of 20 and 64 who have recent experience working. The authors looked at results from February to July 2022 and focused on people who had earned at least $10,000 in 2021.
About one-fifth of the respondents who were not participating in the labor force during the week the survey was conducted said concern about catching COVID-19 or other infectious diseases was the primary or secondary reason they were not currently working or seeking work.
“It is more common among older persons, women, the less educated, those who earn less, and in occupations and industries that require many face-to-face encounters,” the researchers wrote. “People who intend to continue social distancing have lower labor force participation — unconditionally, and conditional on demographics and other controls.”
Some 17.6% of respondents with a high school education or less showed a tendency for strong “long social distancing,” compared with 12.8% of those who had completed some college education, 8.9% of college graduates, and 7.6% of those holding a graduate degree. Similarly, those workers earning the least amount of money were more likely to miss work due to their desire to social distance.
People reporting a strong desire to continue social distancing are more likely to work in jobs that require face-to-face encounters, the study found. In the early days of the pandemic — and before vaccines were available — millions of office workers were able to work from home, while many lower-wage workers faced the highest risk of contracting COVID-19.
Rates of long social distancing are about 3 percentage points higher among Democrats than among Republicans and are even higher among those who identify as independents or members of smaller political parties, the researchers found. “Along several dimensions — education, earnings, industry, and occupation — strong-form long social distancing is more common when remote work opportunities are fewer,” they added.
Businesses have struggled to find workers to fill jobs over the last 12 months, especially in the service and labor sectors. Labor shortages have led to an increase in wages and contributed to 40-year-high inflation rates. And two groups of workers are yet to come back in earnest — those ages 20-24 and those over 65 — the study study concluded. Experts say that unless such workers return to the workforce, hiring will continue to be tough and labor shortages will persist.
This story was updated to include data on COVID-19 cases and hospitalizations.
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