The U.S. may be undercounting COVID-19 cases by a massive margin, Goldman Sachs warns

The crushing jobs numbers last Friday pointed to 20.5 million fewer payrolls in April compared to March.

One of the data points packed into the Bureau of Labor Statistics’ release warrants some further investigation: the amount of people out sick. According to Goldman Sachs, the big jump in people who reported to be employed but not at work due to illness could indicate a severe undercount in the number of COVID-19 cases.

The Department of Labor found that the number of people out sick in April had ballooned to 2 million. This, a research note from Goldman Sachs said, was about 1 million more than seasonal norms. With a pandemic raging, coronavirus could be the cause.

“If we assume for simplicity that (i) this 1 million excess reflects strongly symptomatic COVID-19 cases and (ii) the share of symptomatic COVID cases among employed people resembles that in the population as a whole, this implies around 2 million strongly symptomatic COVID-19 cases in the population as a whole, in a week when the official active cases stood at about 500k,” wrote the analysts.

Goldman Sachs’s chart of the day highlighted the massive increase in people who are employed but unable to work due to illness (Goldman Sachs)

Throughout the coronavirus crisis, indirect numbers have been used to illustrate stories that official estimates can’t tell because of testing limitations. Many have looked to mortality rates and total death numbers, examining the amount of people dying compared to this time last year. Like people missing work, the higher numbers aren’t a guarantee that it’s from the coronavirus, but it’s a potential datapoint for observers to use.

The coronavirus has complicated the labor numbers

The “employed but absent” part of the Bureau of Labor Statistics survey has offered other interesting data, and the unprecedented nature of the pandemic has caused some data problems.

In its monthly release, the Bureau of Labor Statistics said many survey interviewers classified workers who are employed but unable to work during the pandemic as “employed but absent from work” due to “other reasons.”

These people were supposed to have been calculated as “temporarily laid off.” This is why the BLS said the April unemployment rate should really be five percentage points higher. The same survey issue was also present in the March data.

Ethan Wolff-Mann is a writer at Yahoo Finance focusing on consumer issues, personal finance, retail, airlines, and more. Follow him on Twitter @ewolffmann.

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