As we have written previously, the economic recovery is taking on a “K-shape.” That means some industries are doing well (they are the top part of the “K”) while others continue to struggle (the bottom part of the “K”). The job market data is a good example of how the K-shaped recovery is playing out.
The Bureau of Labor Statistics (BLS) publishes industry-level data (table B1) in its monthly jobs report. That data shows which industries are recovering jobs more quickly and those that are slower to recover.
It is clear that jobs losses are heavily concentrated in service industries.
When looking at the higher-level industry data, it is clear that jobs losses are heavily concentrated in service industries. More than 82 percent of the jobs lost since February are service jobs. Almost 11 percent are in goods-producing industries and about 7 percent of the remaining job losses are in government. In this analysis, goods-producing industries are the top of the “K” while services are the bottom.
| Industry | Total percentage of jobs lost |
|---|---|
| - Goods-producing (total) | 10.80% |
| Mining and logging | 0.80% |
| Construction | 3.70% |
| Manufacturing | 6.20% |
| - Private service-providing (total) | 82.10% |
| Trade, transportation, and utilities | 11.90% |
| Information | 2.70% |
| Financial activities | 1.70% |
| Professional and business services | 12.80% |
| Education and health services | 12.60% |
| Leisure and hospitality | 35.80% |
| Other services | 4.60% |
| - Government (total) | 7.20% |
However, the “K” shape exists within these sectors. For instance, while on average goods-producing industries have lost about 6 percent of their workforce since February, mining and logging is down almost 14 percent. The rest of the goods-producing industries have lost between 5 and 6 percent of their jobs.
The “K” shape is more pronounced within service-providing jobs. The total number of service jobs is down almost 9 percent compared to February. But on the top of the “K” within services are utilities jobs which are down about 1 percent, financial activities jobs down 2 percent, and retail jobs down 4 percent. Meanwhile, leisure and hospitality jobs are down about 25 percent.
Goods-producing and Service-providing Industries
| Industry | Jobs Lost February - August (thousands) | Percentage of February Jobs Lost |
|---|---|---|
| Leisure and hospitality | -4,139 | -24.50% |
| Mining and logging | -97 | -13.60% |
| Information | -312 | -10.80% |
| Other services | -531 | -8.90% |
| Service-providing | -9,476 | -8.70% |
| Total nonfarm | -11,549 | -7.60% |
| Professional and business services | -1,475 | -6.80% |
| Transportation and warehousing | -381 | -6.70% |
| Durable goods | -496 | -6.20% |
| Goods-producing | -1,242 | -5.90% |
| Education and health services | -1,457 | -5.90% |
| Construction | -425 | -5.60% |
| Manufacturing | -720 | -5.60% |
| Wholesale trade | -328 | -5.50% |
| Trade, transportation, and utilities | -1,371 | -4.90% |
| Nondurable goods | -224 | -4.70% |
| Retail trade | -655 | -4.20% |
| Government | -831 | -3.70% |
| Financial activities | -191 | -2.20% |
| Utilities | -7 | -1.30% |
The BLS data drills down deeper into sub-sectors. A look at this more detailed data shows the “K” is more prominent among these sub-sectors. There are 16 sub-sectors whose job losses still exceed 20 percent of their February levels. There are also 16 sub-sectors that have added jobs since February. These sectors are scattered across goods and service producing businesses and there is a good deal of dispersion among them.
There are 16 industries with jobs losses still exceeding 20%, and 16 with job gains since February.
For instance, motion picture and sound recording has lost a stunning 50 percent of its jobs, performing arts and spectator sports 46 percent, and scenic sightseeing transportation 43 percent. The 20 percent loss in food and drinking places is less than half of these harder-hit industries.
On the upside, general merchandise stores, including warehouse clubs and supercenters have added more than 10 percent to their workforce. Couriers and messengers are up over 8 percent and building material and garden supply stores and miscellaneous computer and electronic products are both up over 6 percent. A table with all the sub-sectors is below.
The “K” shaped economic recovery is going to require Congress to craft a targeted relief package in its phase four bill. It will need to aid those industries at the bottom of the “K” because these industries are likely to lag behind as long as the pandemic persists.
Industries by Sub-Sector
| Industry | Feb. 2020 Jobs | Aug. 2020 Jobs | Change from Feb. 2020 (thousands) | Change from Feb. 2020 (%) |
|---|---|---|---|---|
| Nonfarm | 152,463 | 140,914 | -11,549 | -7.60% |
| Goods-producing | 21,205 | 19,963 | -1,242 | -5.90% |
| Construction | 7,639 | 7,214 | -425 | -5.60% |
| Manufacturing | 12,852 | 12,132 | -720 | -5.60% |
| Private service-providing | 108,513 | 99,037 | -9,476 | -8.70% |
| Professional and business services | 21,550 | 20,075 | -1,475 | -6.80% |
| Federal Government | 2,867 | 3,163 | 296 | 10.30% |
| State government | 5,199 | 4,981 | -218 | -4.20% |
| Local government | 14,679 | 13,770 | -909 | -6.20% |
About the authors
Curtis Dubay
Curtis Dubay is Chief Economist, Economic Policy Division at the U.S. Chamber of Commerce. He heads the Chamber’s research on the U.S. and global economies.
