Policy makers starting to wake the f*ck up to Long covid - in the "Great Resignation", 3 million people didn't quit their jobs for funsies:
The business world is starting to recognize the economic impact of Long Covid: “Where Are the Workers? Millions Are Sick With Long Covid.” The message is getting to the mainstream media: “Long Covid is destroying careers, leaving economic distress in its wake,” Consider this Dec. 9 quote from...
ritholtz.com
If we have people who have Covid, regardless of age, and then subsequently they develop a condition which disables them, temporarily or permanently — it could be a breathing disability; it could be some other symptom — what medical research is finding about Long Covid is that it may be a blood disease; it can reach into all your organs; it's not just a respiratory illness, flu, or cold. It's a substantial long-term, post-viral condition that defines Long Covid. And this mechanism is now creating folks who are disabled in some way. They could be partially disabled, meaning they can work some of the time. They could also be temporarily fully disabled for a period of time, and that's an unknown quantity.
If you have a cohort of people in the country who have disabilities that weren't there two years ago, some of them are in the labor force, say, between the ages of 15 or 16, and their late 60s or early 70s. And that cohort is in the millions of people. Some have difficulty going back to work, and others have difficulty when they do go back to work, and they have to take time off because they are ill. They are suffering from a disease, and the disease is post-viral, but it isn't visible.
When you take a chunk of people, millions of people, out of the labor force, you get a shock. Wages rise, pay levels rise. There are fewer people to do the work, so we see that in the labor force data. It's not monetary inflation from the Federal Reserve. It's payment for jobs when there aren't enough skilled people to fill them. And that only results in one thing: The economy must reprice labor at a higher level to reach some clearing equilibrium.
Generally, you get new productivity gains when you have to substitute the application of technologies for labor. Why? You don't have the people, and you have to do something, so you substitute capital investment for labor. That has huge investment implications, and stocks in certain industries, groups, and sectors perform positively as a result.
The economy has experienced a massive shock. It originates in a pandemic — they come along every 50 or 100 years, and we are ill-prepared for them, as we have been ill-prepared for this one. The last one was 1957–58 with the Asian flu, and before that it was the Spanish Flu from 1917, '18, '19, '20, and '21, although everybody thinks of that as 1918 because of John Barry's book. I might point out that in '57 and '58 a President of the United States by the name of Dwight Eisenhower immediately ordered and vaccinated 17% of the population. He vaccinated the entire military establishment, all of the defense contractors, and the government. Why? He was a general, the winner in WWII, and he knew he couldn't fight wars against enemies with a sick army. There was no anti-vax; there was no discussion akin to this political debate that is ripping apart our country. Eisenhower did it in 1957. There are precedents for such things. Unfortunately, they don't make the top of the news.