The ‘Rocket Ship’ Economic Recovery Is Crashing

Child care constraints are keeping many workers, particularly Black and Hispanic women, from returning to work, according to weekly census survey data analyzed by Ernie Tedeschi, an economist at Evercore ISI.

Some economists say the slowdown was predictable — and a natural reaction to Americans attempting to rush back toward normalcy before the virus was under control.

When it comes to the recovery, “the virus is the boss, not the governor, not the mayor, not the president,” said Austan Goolsbee, a former top economist for President Barack Obama and the author of a recent study that found fear of infection — and not government lockdown policies — drove nearly all of the contraction in economic activity this spring.

Mr. Goolsbee, who is a professor at the University of Chicago’s Booth School of Business, and his colleague Chad Syverson used cellular phone records to track visits to businesses during the pandemic.

The research found that just over one-tenth of the drop was attributable to lockdowns themselves, a share that held constant as areas began to lift restrictions in May. The authors say that suggests that if infections accelerate, public officials will not be able to avoid another economic shock simply by refusing to shut down activity. Consumers will make that decision for them.

When cases of the virus first began rising earlier this year, many economists hoped that, with the right set of policies, the United States could avoid most long-term economic damage. The idea was that by providing trillions of dollars in support for households and businesses, the federal government could, in effect, keep the economy in stasis until the health crisis had passed.

There are signs that those efforts were at least partly successful. Nearly a third of the people who lost jobs during the pandemic have already returned to work, according to a poll conducted for The New York Times in early June by the online research platform SurveyMonkey. Another quarter expected to return to their old jobs within the next month.

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