• Job growth —in the overall U.S. workforce, and confirmed by separate male and female index measures—continues into August.
  • Despite recovery, August Index levels remain below the January, February and March levels for both men and women separately as well as overall.
  • Index values for men increased by the same margin as the Index for women in August.

Welch Index, rise in August 2020Welch Index by gender, rise in August 2020Introduction

The Welch Index is a data analytics tool used by our labor economists to measure full-time equivalent employment after adjustment for population growth and the aging of the workforce. An Index value of 100.0 indicates that the adjusted full-time equivalent employment level is the same as its level in the base period of July, 2004.

Any decrease (increase) in the Index value over a particular period implies that full-time equivalent employment level has decreased (increased) relative to the growth of the adult population during that period.

For example, over the past 12 months the Index has fallen 6.9 points, from 102.7 to 95.8. This means that full-time equivalent employment level increased at a rate 6.9% slower than the increase in the U.S. adult population over the past year (after making adjustments for the aging of the population). Given the onset of the pandemic and related lockdown measures, we find that all of the decline in the past year has occurred since January.

Over the past three years, the overall Index value has declined by 4.8 points or at an average rate of 1.6 points per year. This is an improvement compared to July. As of July, the average rate of decline was .8 points higher with a value of 2.4 points per year.

Looking by gender, we find that the Index for women is down 4.6 points while the Index for men is down 5.0 points over the past three years. This converts into an average decline of 1.5 points per year for women and 1.67 points per year for men.

Continued Employment Recovery Through August but Index Values Remain Below their January Levels

Employment levels have recovered since April. However, this recovery has not been enough to entirely offset the sharp decline that occurred between January and April of this year.

The Welch Consulting Employment Index rose 2.3 points in August, from 93.5 to 95.8. This continued rise in the Index has reversed over 50% of the sharp decline the Index experienced in April. The current level of 95.8 is still well below the record high of 103.4 that the Index set in January.

Similar Increase in Employment Levels for Men and Women in August

Between April and June, the Index for women had been increasing by a higher margin than the Index for men. In July however, this trend was reversed and the Index for men increased more than the Index for women.

Different from these earlier patterns, the Index for both genders rose equally by 2.3 points in August. For men, it rose from a level of 91.1 in July to 93.4 in August. The current Index value for men continues to be below that of women. For women, the Index value increased from 96.4 in July to 98.7 in August.

With this rise, the Index for women has recovered over 52% of the initial 17.3-point decline from January to April.  Similarly, the Index for men has recovered over 48% of its initial 13.9-point decline.

Underlying Factors Behind the Trends and Concluding Remarks

Our economic consulting experts find overall increases in Index values to be consistent with a continued business recovery across many sectors of the economy after the initial lockdown. Certain jobs such as “Personal Care and Services” saw a significant contraction while others such as “Health Care Support” witnessed an expansion.  Distribution of men and women across these jobs is one explanation for the gender differences in employment patterns.

Technical Note: Full-time equivalent employment equals full-time employment plus one half of part-time employment from the BLS household survey (the Current Population Survey). The data reported for a given month is generally from the calendar week that contains the 12th day of the month. The Welch Index adjusts for the changing age distribution of the population by fixing the age distribution of adults to the distribution in the base year of 2004. Seasonal effects for the share of workers employed in part-time jobs are removed in a regression framework using monthly indicator variables.

Gender and Job Loss in the COVID Economy