The novel coronavirus has reminded us of the fragility of life, but also the fragile foundations of Louisiana’s economy. That is particularly true for families who were already struggling to make ends meet before the pandemic.
More than 506,000 Louisiana workers filed for unemployment in the six-week period between March 21 and April 25. The people who were hardest hit toil disproportionately in industries that paid some of the lowest wages, and where black and brown workers are overrepresented.
The pandemic represented a perverse double-jeopardy for workers of color in Louisiana. They are more likely to work in the low-wage, front-line jobs that are essential in our new economy – nursing home orderlies, supermarket cashiers and sanitation workers – and thus more likely to be infected by the virus. And they also are more likely to work in the industries that have suffered the biggest job losses, such as restaurants and hospitality.
As Louisiana policymakers chart the state’s recovery, they must keep these disparities in mind and use this moment to chart a more equitable path forward. An equitable path is one that rewards all types of work and every working person with a secure, living wage and benefits such as paid sick leave and guaranteed health coverage.
Data on state unemployment claims filed since mid-March shows that low-wage service industries have been hit much harder by the economic shutdown than higher-paid industries such as manufacturing, and professional and managerial jobs that many people can do at home.
More than 112,000 Louisianans working in “food service and accommodations,” which includes restaurants and hotels, have filed unemployment claims in the last six weeks. That’s more than half the industry’s 2019 workforce. It is also the industry that pays the lowest average wage of any other industry, which makes it harder for people working these jobs to save up for a rainy day, or, in the event of Covid-19, an emergency stay at home order.
Compared to the rest of the country, the pre-pandemic workforce in Louisiana was disproportionately concentrated in industries such as leisure, hospitality, trade and transportation. Even in the lucrative manufacturing sector – which makes up a much larger share of Louisiana’s economy than in a typical state – Louisiana still has fewer jobs compared to other states.
High-paying jobs will not be immune to the downturn. The “mining” sector, which includes oilfield and oil and gas servicing jobs, is expected to be devastated by the collapse of oil prices. While the total number of oil and gas jobs is small compared to the service-industry workforce, the South Louisiana communities where these jobs are concentrated are likely to suffer greatly from the downturn.
Compared with the rest of the United States, Louisianans are underrepresented in more lucrative industries like professional services, finance and information where people are more likely to be able to work at home and are less vulnerable to layoffs.
Front-line workers are often poorly paid
In addition to being highly vulnerable to layoffs, the industries that employ the most people are also the lowest-paid. Front-line workers in retail, health care, hotels and food service industries all pay average wages that are less than what’s required for a family of four to survive.
Before the pandemic, nearly half of Louisiana households didn’t make enough to provide for their families. The four largest industries in the state (measured by total jobs) pay an average wage below the ALICE (Asset Limited Income Constrained Employed) Survival Budget for a family of four.
This means that workers that are directly impacted by the important steps that have been taken to slow the spread of the new coronavirus, like retail and hospitality workers, are also least able to absorb the financial hit. And, those who may be able to remain on the job, like health care and education workers, are struggling below the ALICE threshold.
Louisiana and the federal government have taken important steps to help these workers by expanding the availability of unemployment benefits and reducing the barriers to claims filing. But there is more to be done, including lifting wages, mandating paid leave and sick days, and making education and training more accessible and affordable for people who want to retrain for a new career.
-By Stacey Roussel and Jan Moller