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Evictions, tenants and the fragility of a “correlated” world
Evictions, tenants and the fragility of a “correlated” world
As eviction moratoriums around the United States come to an end, it is expected that landlords will begin evicting nonpaying tenants en masse. Eviction by itself is an unremarkable phenomenon in America. Some 900,000 per year have been occurring routinely in the last several years affecting about 2.3 million people annually.
The scale this time is different. No one knows exactly how things will play out in the United States (or elsewhere for that matter). But, barring new moratoriums on eviction one estimate suggests 23 million people will be subject to eviction by the end of September, more than 10 times the number for an entire year.
Where all those households would go is a puzzling question as the limited space in facilities for the homeless could never hold them. And, given the continuing coronavirus pandemic, those facilities that are observing proper social distancing have had to limit their capacity.
Perhaps the U.S. Congress will come to its senses and pass aid for renters just as it has done for businesses. I am doubtful about such prospects.
But, I am also interested in another important question: Who will replace evicted tenants? Here the problem of correlation looms large. Generally speaking, landlords don’t worry too much if Joe in apartment 238 and Sally in apartment 424 both lose their jobs. Their job losses are usually related to their specific circumstances, a company moving its operations or a firing due to poor performance. These losses are uncorrelated to the situations of other tenants. There will therefore be paying tenants to take the place of Joe and Sally should the landlord have to evict them.
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Job Loss Disaster Slams Low-Wage, Young Workers
Job Loss Disaster Slams Low-Wage, Young Workers
April numbers show three million lost jobs, while another 2.5 million people had their hours cut in half.
We thought the March jobless numbers were bad, but it is almost a good news story compared to what we saw Friday in the April figures.
The unprecedented closure of major sections of Canada’s economy in mid-March is finally being reflected in the jobless numbers. Of course, without those closures we would be in a historic health crisis with emergency rooms overflowing and our health system shutting down, as we saw elsewhere.
In that sense, this shutdown was exactly the right thing to do. I look at these unprecedented joblessness numbers and think: this is how we protected many workers from contracting the virus — though they sacrificed their income.
The official unemployment rate for April is 13 per cent. This is a historic high. There was a single month, December 1982, when unemployment was slightly higher at 13.1 per cent. But after that one month you’d have to go back to May 1936 at the end of the Great Depression to see anything similar. Put another way all jobs created since October 2005, 15 years ago, have been lost by April 2020. While the March data was collected as the shutdown was in progress during the third week of March, the April figures show the full impact of a month’s worth of pandemic lockdown.
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