78% of workers say their layoff is temporary

Luis Mora stands in front of the closed offices of the New York State Department of Labor on May 7, 2020 in Brooklyn, New York City.

Stephanie Keith | Getty Images

The economy lost a record 20.5 million jobs in April, but nearly 4 in 5 workers surveyed by the government see their layoffs as temporary.

The number of employees who saw themselves as temporarily furloughed was 18.06 million, up from 1.84 million in March. The interviews were conducted as part of the household survey of about 23 million who have lost their jobs, including those who lost their job in April.

“It’s high in a good way. The market could be reacting to that. If you see them move to permanent that’s a problem,” said John Briggs, head of strategy at  NatWest. 

Stocks opened higher on Friday, even after the dismal jobs report.

Michelle Meyer, Bank of America head of U.S. economics, called the high number of temporary layoffs a “silver lining” in a bleak report.

“With 78% classified as temporarily unemployed, workers should be able to be more seamlessly rehired upon reopening. But time is of the essence,” she wrote in a note. 

The unemployment rate surged to 14.7%  in April. Those who say they are temporarily furloughed expect to be back to work within six months — a potentially good sign for the economy.

“Over the last 50 years, the three recessions with the highest share of temporary layoffs were followed by the fastest labor market recoveries,” wrote Goldman Sachs economists.

Treasury yields, which move opposite price, were slightly higher after the report.

Clarification: This story was revised to clarify the government’s household survey was for about 23 million unemployed workers.

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