L.A. Biz Leadership Trust | By Hari Abburi, Managing Partner at The Preparation Company
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A possible silver lining to the COVID-19 crisis: It has a sense of urgency that, in my view, was needed all along to redefine jobs and our workforce at large. At the time of writing, about 26 million jobs are reportedly lost, which has essentially wiped out the jobs gained over the past decade. But the impact of COVID-19 on our economy is different than the 2008 financial crisis in one key aspect: It’s global. It has brought life to a standstill. It is important to understand the talent factor. The U.S. economy was growing at 2.1% at the end of 2019, which was slightly above the prerecession average. Unemployment was 3.5%, the lowest in 50 years. With 26 million jobs now lost, the real unemployment rate could be as high as 20.6%. Say the economy recovers in the second half of 2020. Will all of the jobs that were lost come back? I believe they won’t, for two reasons. First, the pace of recovery may not be quick enough. Second, businesses that are hardest hit will be risk-averse, meaning they won’t want to take on the costs of new hires.