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Topics: Accounting, Covid-19, payroll

Payroll Has Made a Come-back Amidst Covid-19

2 MIN READ | Posted on July 07, 2020
Written By Rishmita Aich

Payroll Has Made a Come-back Amidst Covid-19

The Labor Department reported that the US payrolls added 4.8 million in numbers last month. This was the second month the recorded strong gains in payrolls and is a clear sign that payrolls are returning slowly but surely amid the coronavirus pandemic that has already claimed over 0.5 million lives worldwide and affected almost 3 million people in the US. In April, tens of millions of job cuts were recorded, as businesses sought outsourced accountant services to explore their options for survival.

The silver lining is that the job growth surpassed the forecasts by economists. Interestingly, this growth has been wide-ranging across different industries and demographic groups.

This respite from the dark moments has still to go a long way to mean any recovery because it is still 15 million jobs lesser than in February, before the full impact of the pandemic was felt by the business world.

Unemployment Rate

The June unemployment rate fell to just over 11%. April recorded the peak figure of 14.7%. still, the June figure was much higher than any previous month since the WWII.

According to an economist with the Federal Reserve Board of Governors, over 3 million jobs were added through the Paycheck Protection Program since the CARES Act was passed. It is a significant number.

A significant percentage of these qualifying firms have gained from the assistance of accounting outsourcing india services. The total number of hours were 5% higher at businesses that qualified for the PPP compared to businesses that didn’t qualify.

Earlier Job Loss Estimates

An economist at the Moody’s Analytics has claimed that it will be long before a major job recovery can be seen compared to the number of jobs lost this year because of the impact of the pandemic. The reputed firm reports that 22 million jobs were lost. In a best case scenario, 12 million jobs are expected to be regained by Labor Day.

The social distancing norms are expected to prevent or make it very difficult for the rest of jobs to return. The concerning industries in this regard include retail, airlines, and transportation. In fact, these sectors are expected to return to their full operational capacity, not until 2 years from now. Even that estimate is based on the assumption that a vaccine will be available within a few months from now.

Comparison with Great Recession

A well-known economist from the University of Chicago has claimed that adding even 10 million jobs by this summer can be a difficult assumption to make. This pandemic has seen twice the number of job loss compared to the Great Recession.

Employers are relying on accounting outsourcing india services to get over the impact of the changes their businesses have had to undergo. Even is massive expansions are recorded, employment is expected to be at least 8 percent lower than what it was in March.

This is expected to be the norm until there is a cure and the general public starts feeling safe. That is expected to be the point when the job market can expect to return to normal.

Even when the job market seems to pick up, the overall financial condition will need some time before it can be considered a healthy recovery.

Rishmita Aich

As a Journalist turned Marketer, Rishmita has developed a unique perspective when it comes to analysing & covering the changing landscape of the accounting industry. Influenced by Andrew Sorkin and Stephanie Flanders, she aspires to deliver souhgt-after advice, fresh updates & detailed analysis of HMRC legislations through her work for accounting practices to make better, informed decisions. She has spent the last 3 years creating insightful content for accountants, and is currently most passionate about the work she is doing to educate accountants about outsourcing.

Originally published Jul 07, 2020 06:07:17, updated Mar 31 2021

Topics: Accounting, Covid-19, payroll

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