Nearly 80% of Laid-Off Workers Are Optimistic They’ll Return to Their Jobs

The COVID-19 pandemic has forced widespread economic shutdowns, leading to over 33 million unemployed Americans—the country’s worst period of job loss since the Great Depression—but a new poll indicates that a significant majority of laid-off workers believe their economic malaise to be temporary. A Washington Post-Ipsos poll indicates that 77% of laid-off or furloughed workers expect to be rehired once stay-at-home orders are lifted. Just 20% believe it is somewhat or very unlikely they will be rehired by their former employer.

A new Gallup poll reveals that consumer spending is down too, with a majority of respondents saying they are spending less money, the first time this Gallup poll has returned that result since the Great Recession in 2009-2010. Like the WaPo-Ipsos poll, those polled by Gallup believe this slowdown to be short-lived, with 47% of those spending less believing that their depressed economic activity is temporary. In 2010, 33% of those spending less thought it to be just a temporary slowdown.

This polling indicates that despite the widespread economic devastation, a positive sentiment amongst the labor force and consumers still persists. Jose Monga, who sells materials to construction sites, told WaPo that “I figure they might call me at the end of this month to start again in June. But I don’t know. If I worked in a restaurant, I probably wouldn’t be that optimistic. But construction is still going.”

Economists worry that this optimism ignores the harsh reality beginning to take root. In any economic condition, people who are laid off for longer are less likely to be rehired. General Electric and Nordstrom initially announced employee furloughs, but now some are becoming permanent layoffs. A report from the Becker Friedman Institute at the University of Chicago predicts 42% of recent layoffs due to the pandemic will become permanent. The Congressional Budget Office predicts that America will still be stuck at 9% unemployment by the end of 2021.

The issue at the heart of this is something that people do not need a degree in economics to understand. Many companies are going bankrupt, which leads to them firing their workers, and polls reveal that most Americans are hesitant to resume normal economic activity even with the blessing of medical experts. The less money Americans are spending, the less money companies have to pay their workers. Additionally, as businesses like restaurants shift their model to takeout in order to accommodate the new reality imposed by the coronavirus, they are realizing that they do not need nor can many afford additional workers.

Betsey Stevenson, an economics professor at the University of Michigan, told WaPo that “Even if a miracle cure falls out of the sky in July, it’s going to take demand a while to pick back up. There’s no way travel or retail look the same and brings everybody back.”