Rough Diagnosis: Coronavirus Ails Job Market

The coronavirus pandemic has already pummelled the stock market, and the job market may be next. Some ominous signs are already emerging, like state unemployment websites being overrun as businesses around the country are forced to shut down or limit service due to the virus outbreak. A new report by Moody's Analytics puts it in more direct terms, rating 80 million U.S. jobs at "moderate" or "high" risk due to coronavirus. Of the 27 million jobs Moody's listed at "high risk", most are in transportation and travel, leisure and hospitality, and oil drilling and extraction.

Andy Challenger, Vice President of the outplacement firm Challenger, Gray & Christmas, says the service industry will bear the brunt of the current mass closures. "Many service-based jobs need to be done in person, they can't be done at home," he says. "And they require customer foot traffic that has really evaporated over the last few days."

While everyone expects industries like airlines and cruise ships to get hammered, the threat is even greater down the food chain. "The small businesses that are being most affected right now are low-margin businesses with low capitalization, and they can't float workers for much more than a couple of weeks at most," says Challenger.

Another industry taking a bath is energy, thanks to plunging crude prices. "In Houston, you're also facing a simultaneous downturn in oil," says Challenger. "We just saw that Halliburton furloughed 35-hundred employees for at least 60 days."

As for a solution, the Trump Administration is pushing a massive stimulus package that would help battered industries and "flood" the economy directly with money, according to Treasury Sec. Steven Mnuchin. At the same time, the Small Business Administration is offering emergency loans to businesses to help make payroll and stay afloat until they can reopen. "We'll see how quickly those efforts get off the ground, and how effective they are at stemming a downward spiral," says Challenger.

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