U.S. Economic Recovery Quiets as July 4 Holiday Causes Dip in Shift Work

In alignment with the national July 4 holiday observance, total volume of shifts worked¹ decreased by 11.4% from June 29-July 5, mirroring – and, in fact, falling short of – the decline in shifts that occurred the week of July 4, 2019 (-26.9%). According to the latest U.S. Workforce Activity Report from Kronos Incorporated, prior to the July 4 holiday, U.S. businesses had grown shifts by 32% since shift work hit “the bottom” the week ending April 12. Overall, shift volume remains down 24.3% since the week ending March 15 – the last week of “normal” shift work activity before the U.S. declared a national emergency.

The delta between employee terminations², which includes both voluntary and involuntary turnover, and new employee hiring³ widened during the week ending July 5. Prior to COVID-19, this ratio stood at nearly 1 termination for every 1 new hire; yet it currently stands at 2.8-to-1, the nation’s largest delta since the 3.2-1 ratio that occurred when employee shifts hit “the bottom” the week ending April 12.

For the first time since Memorial Day, all 50 states saw a decline in shift work due to the July 4 holiday. Across the U.S., 16 states experienced or surpassed an average of 100 new COVID-19 cases per 100,000 residents per week⁴, with 11 of these states seeing double-digit declines in shift work from June 29-July 5: Alabama (-14.0%); Arkansas (-10.6%); Georgia (-14.9%); Idaho (-11.2%); Iowa (-10.6%); Louisiana (-12.5%); Mississippi (-17.3%); North Carolina (-15.4%); South Carolina (-17.6%); Tennessee (-17.2%); and Utah (-12.9%). The Midwest⁵ (-13.8%) and Southeast⁶ (-12.6%) saw nearly double the week-over-week shift decline compared to the Northeast⁷ (-7.7%) and West⁸ (-8.4%).

Five industries central to the U.S. economy were impacted to varying degrees by the July 4 holiday. Manufacturing saw the largest week-over-week decrease (-19.6%), while retail, hospitality, and food service, bolstered by holiday demand, held mostly flat (-1.7% week over week). Public sector, well into its anticipated slower summer season, declined 12.4% week over week. Services and distribution (-8.4%) and healthcare (-7.2%) saw modest holiday-related declines. Despite this dip, across all industries, shifts declined less during the 2020 July 4 holiday week than during the week of July 4, 2019.

Dave Gilbertson, vice president, HCM practice group, Kronos

“Over the past six weeks, we have seen the national economic outlook begin to temper: The upward trendline of shifts, peppered with holiday-related declines correlating with Memorial Day and July 4, has slowed; the delta between terminations and hirings continues to swell; and industries continue to recover shifts at varying paces based on state reopenings, restrictions on travelers, and inconsistent consumer demand. While last week’s July 4-related shift decrease was not as large as expected based on historical data, we can’t yet come to any conclusions based on a single week – especially since the holiday fell on a weekend, which may impact vacation for a second week. Data over the next several weeks should indicate whether the relative strength of recovery is enough to reverse slowing shift growth amid nationwide COVID-19 case spikes.”

Footnote 1: “Shifts worked” is a total derived from aggregated employee time and attendance data and reflects the number of times that employees, especially those who are paid hourly or must be physically present at a workplace to perform their jobs, “clock in” and “clock out” via a time clock, mobile app, computer, or other device at the beginning and end of each shift.

Footnote 2: “Terminations” is the aggregate number of employee profiles that are deactivated/removed from a Kronos cloud solution, indicating a termination of employment. The cause could be a layoff or resignation, as examples. Termination dates may be pre- or post-dated, creating minor variations in prior week’s data.

Footnote 3: “New hires” is the aggregate number of new employee profiles created inside a Kronos cloud solution. A new employee profile is created when an individual is hired into a position. New hire dates may be pre- or post-dated, creating minor variations in prior week’s data.

Footnote 4: Centers for Disease Control and Prevention COVID-19 U.S. case tracker: https://www.cdc.gov/coronavirus/2019-ncov/cases-updates/cases-in-us.html

Footnote 5: For the purposes of this report, Midwest is defined as Illinois, Indiana, Iowa, Kansas, Michigan, Minnesota, Missouri, Nebraska, North Dakota, Ohio, Oklahoma, South Dakota, Texas, and Wisconsin.

Footnote 6: For the purposes of this report, Southeast is defined as Alabama, Arkansas, Georgia, Florida, Kentucky, Louisiana, Mississippi, North Carolina, South Carolina, and Tennessee.

Footnote 7: For the purposes of this report, Northeast is defined as Connecticut, Delaware, Maine, Maryland, Massachusetts, New Hampshire, New Jersey, New York, Pennsylvania, Rhode Island, Vermont, Virginia, and West Virginia.

Footnote 8: For the purposes of this report, West is defined as Alaska, Arizona, California, Colorado, Hawaii, Idaho, Montana, Nevada, New Mexico, Oregon, Utah, Washington, and Wyoming.