The pandemic has record issues with unemployment. It caused layoffs, people to quit their jobs, and even early retirements. However, economists are now saying that the millions who were forced into early retirement may be the key to reviving the economy — if they rejoin the workforce. In other news, if Congress doesn’t act soon to fix the debt ceiling, officials will face some tough decisions on how to handle Social Security and other payments.
Millions of workers retired during the pandemic. The economy needs them to “unretire,” experts say.
An economist will tell you it’s a hot labor market: A record number of people quit their jobs in September, and the U.S. is seeing record job openings as the economy chugs back to life from the coronavirus pandemic. The pandemic drove millions of workers into early retirement — and experts say they could be key to reviving the economy.
The number of people who retired rose much faster than the typical pace during the pandemic. More than 3 million additional people retired compared with normal, a Federal Reserve Bank of Saint Louis analysis found. Meanwhile, the economy is still down nearly 4 million jobs from before COVID-19.
“40% of the older workers that were pushed out of the labor market because they were unemployed, they were laid off, they were fired during the pandemic, 40% of them were permanent job losers and most of them said OK, I’m not just a discouraged worker, I’m not a long-term unemployed, I’m going to tell the [Labor Department] survey I’m retired,'” said Teresa Ghilarducci, labor economist and professor at The New School.
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Here’s what could happen to Social Security, Medicare and other payments if Congress doesn’t fix the debt ceiling
The federal government could reach the maximum amount of money that the U.S. Department of the Treasury is allowed to borrow as soon as Dec. 15.
If Congress doesn’t act to fix that limit, known as the debt ceiling, there could be big ramifications for the timeliness of government payments that people rely on.
A new analysis from the Bipartisan Policy Center explores what could happen if that date passes without a new deal to fund the government.
“Realistically, on a day-to-day basis, fulfilling all payments for important and popular programs [e.g., Social Security, Medicare, Medicaid, defense, military active duty pay] would quickly become impossible,” the Bipartisan Policy Center states.
Between Dec. 21 and Jan. 28 — what the Bipartisan Policy Center calls the “X date” — the Treasury Department would have insufficient cash to fund its obligations.
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CNN Business/Laura He
China pumps $188 billion into the economy to counter real estate slump
China has decided it’s time to loosen its purse strings and pump money into the economy in a bid to stave off threats to the recovery.
The People’s Bank of China on Monday said it would cut the reserve requirement ratio for most banks by half a percentage point, starting December 15. That move, which reduces the amount of money that banks have to keep in reserve, will unleash some 1.2 trillion yuan ($188 billion) for business and household loans.
The decision — the second cut to that ratio this year — came on the same day China’s Politburo signaled that it may take more aggressive actions to protect the economy in 2022. The Chinese Communist Party’s leadership team, chaired by President Xi Jinping, said in a statement that “ensuring stability” would be a top priority in the coming year.
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