A historic number of workers have become their own bosses amid the COVID-19 pandemic, according to data from the Bureau of Labor Statistics (pdf).
Article by Katabella Roberts from our premium news partners at The Epoch Times.
As of October, there were about 9.44 million unincorporated self-employed individuals in the United States, as per the bureau’s data. In October 2020, there were about 8.78 million unincorporated self-employed individuals in the country.
The latest figures amount to a rise of 500,000 people since the start of the pandemic and an increase of 6 percent in the number of self-employed, while the overall U.S. employment total remains nearly 3 percent lower than it was before the pandemic.
In October, there were 432,101 business formation applications filed in the United States, according to data from the Census Bureau. In October 2020, there were 414,195 applications filed to register a new business.
A number of reasons could be behind the wave in self-employment rates, including growing fears among employees returning to their place of work amid the ongoing pandemic, the stress of the pandemic, a desire for more job flexibility, government mandates, or a lack of access to child care.
The figures come as more hiring difficulties appear to be on the horizon for U.S. firms amid a weak labor supply, according to the bureau’s most recent jobs report.
Its October jobs report, released on Nov. 5, shows that employers added more than 500,000 jobs in October, beating market expectations and painting a more positive picture of labor market recovery compared to the September report. However, the labor force participation rate—a measure of how many people work or are actively looking for jobs—was unchanged at 61.6 percent in October and has remained within a narrow range of 61.4 percent to 61.7 percent since June 2020.
The October participation rate is 1.7 percent lower than February 2020, during the height of the COVID-19 pandemic.
The nationwide labor shortage has prompted employers across the United States to raise wages and implement attractive bonuses and competitive compensation in an effort to pull in new workers. Starbucks, Costco, Walmart, Target, CVS Health, and Walgreens Boots Alliance are just a handful of companies that have all said they’re boosting starting wages to $15 per hour—in line with President Joe Biden’s push to raise the minimum wage to that amount—in an effort to recruit more workers.
Federal Reserve Chairman Jerome Powell said this week that the emergence of a new CCP (Chinese Communist Party) virus variant poses a risk to employment and inflation in the United States.
Known as Omicron, the new variant was first detected by South Africa on Nov. 25.
“The recent rise in COVID-19 cases and the emergence of the Omicron variant pose downside risks to employment and economic activity and increased uncertainty for inflation,” Powell told the Committee on Banking, Housing, and Urban Affairs and Senate lawmakers on Nov. 29. “Greater concerns about the virus could reduce people’s willingness to work in person, which would slow progress in the labor market and intensify supply-chain disruptions.”
He didn’t discuss any proposed monetary policy actions by the central bank or whether officials are considering changing the pace of the tapering of its asset purchases.
“We understand that our actions affect communities, families, and businesses across the country,” Powell said. “Everything we do is in service to our public mission. We at the Fed will do everything we can to support a full recovery in employment and achieve our price-stability goal.”
As federal officials are pulling back bond purchases in line with falling unemployment levels, it’s unclear how the emergence of the Omicron variant will affect those plans.