Can a Mask Mandate Improve Employment? Data Points to Yes.

While hourly unemployment and underemployment improved slightly in July, an interesting trend appeared to emerge that suggests, mask mandates and executive orders play a role in hourly employment trends.

A recent study by economists at Goldman Sachs suggested that  national mask mandate could recover five percent of GDP.  July provides our first opportunity to detect any such relationship in hourly employment data across several states. 

Let’s unpack what happened in the first and second half of July, starting in Minnesota.

In June, a national reopening was underway, and confidence was high going into July and the holiday weekend. The public’s willingness to venture out and relax its steady diet of social distancing and small gatherings was likely a factor in the holiday weekend uptick as masks were not a consistent requirement in reopening plans. As a result, hourly workplaces like restaurants staffed up to support the growing customer demand. 

Then, like cheating on that diet, we realized we shouldn’t have binged so hard during the holidays. Many resumed social distancing—especially as COVID-19 cases began to increase across the country and the public became warier of venturing out. Businesses adjusted their team capacity to meet waning customer demand, and according to the Hourly Workforce Index, several states like Minnesota and Florida lost a lot of their June recovery in the first half of July. 

As America muscled through the first half of July, several states (or counties within States) began mandating masks in indoor public spaces. The Centers for Disease Control and Prevention expanded its national mask guidance, encouraging Americans to wear them in all “public settings when around people outside of their household.” 

In the days and weeks following the mandates, hourly employment started to rise or stabilize in Colorado, Washington, and Oregon. There were even sharper upticks in states like Texas and Minnesota. The trendlines below show the daily change in hourly employment activity compared to last year.

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While the primary reason to wear a mask is for public health, there may be another reason that this data suggests: economic health. The mask mandate may be giving the public more confidence to venture out, and employers and employees more confidence to open and work safely. The result is increased customer demand, a rise in hourly work, and an improvement in overall economic activity.