Trump adviser says America's "human capital stock" ready to return to work, sparking anger
Kevin Hassett, a top economic adviser to President Donald Trump, sparked indignation after saying that the nation's "human capital stock" is ready to return to work, with critics calling the term "dehumanizing."
Despite the backlash, the term is standard in economics, and refers to the labor force or workers. Yet the incident points to the disconnect between economists' technical vocabulary and the stress that many unemployed or furloughed workers are experiencing amid the coronavirus pandemic.
"Our capital stock hasn't been destroyed — our human capital stock is ready to get back to work, and so there are lots of reasons to believe that we can get going way faster than we have in previous crises," Hassett said Sunday on CNN.
“Human capital stock” is a stupid way to refer to people even if you’re an economist talking to other economists about economics.
— Ryan Avent (@ryanavent) May 26, 2020
At the end of April, two-thirds of Americans said they had concerns about returning to the workplace, with only one-quarter of respondents saying they expected to go back in May, according to a poll from Qualtrics.
One furloughed worker, Noah Kowaloff, 42, of Framingham, Massachusetts, told CBS MoneyWatch last week that he expects to still have his job when the retailer reopens, although no date is set for the reopening. Even so, he expressed concern about the safety of returning to a job that involves close contact with other people.
"I'm not closed off to going back, but I'm not going to go back unless it's safe to do so," Kowaloff said. "My perspective of retail is that no job is worth putting my health at risk."
I see a lot of people dunking on the term "human capital stock" but...that seems like a pretty standard, boring economic term to me. Came right after an analogy to the sharp post-WWII bounceback, when US benefited from not having its (non-human) capital stock destroyed https://t.co/GbnVQ7r0EW
— Catherine Rampell (@crampell) May 25, 2020
The nation's jobless rate has spiked, with the unemployment rate soaring to 14.7% in April from 4.4% in March — the highest since the Great Depression. It's expected to be worse in May, with JPMorgan Funds chief global strategist David Kelly noting Tuesday in a client note that another 3 million jobs could be lost this month. The jobless rate could eventually reach 20%, he predicted.
Even with states slowly reopening businesses, any economic turnaround is unlikely to be quick, according to Fitch Ratings.
"The return to economic normality is likely to be a slow and bumpy process," the credit rating agency said Tuesday in a report. "The rupture in the labor market — with U.S. unemployment now expected to peak at 20% in May — and ongoing social distancing will weigh heavily on consumer spending post-crisis, while firms will be very cautious on capital spending."