Missing Workers and Missing Jobs Since the Pandemic

Since the start of the Covid-19 pandemic, the U.S. labor market has been characterized as being plagued by missing jobs, i.e., payroll employment has fallen more than five million jobs short of its pre-pandemic trend, and missing workers, i.e., the labor market participation rate has declined by 0.7 percentage points. We show that both the number of missing jobs and the number of workers missing due to Covid have been overstated and that the decline in the labor market participation rate since the start of the pandemic reflects a continuation of its long-run downward trend. Instead, our payroll jobs accounting yields a 1.4 million cyclical surplus in payroll jobs in April 2023 compared with right before the pandemic