According to recent figures from the Department of Labor, an additional 6.6 million Americans filed for unemployment benefits in early April. The total number of Americans currently unemployed surpasses the record number set during the Great Depression, and some economists believe it could get even worse.
Currently, 16.8 million Americans are reported to be out of work. The sheer number of unemployed Americans surpasses the astonishing 15 million number reached during the Great Depression of 1933. However, the unemployment rate, which currently may be as high as 13%, remains below the Great Depression high of 25% as the population of the United States has almost tripled since 1933. The actual number of unemployed Americans may be higher, however, as more claims pour in daily, and some unemployed Americans may not be filing claims.
Globally, the situation is just as grim. A study by the United Nations found that 81% of the global workforce is currently unemployed as a direct result of the coronavirus pandemic. The outbreak is expected to eliminate 6.7% of working hours globally.
Many financial experts are warning that the already dire situation could become much worse. Many are predicting that the unemployment rate will continue to mount, and many more are speculating that the GDP of the United States and many nations abroad will take a significant hit.
Former Federal Reserve Chairwoman Janet Yellen predicted that the GDP could shrink as much as 30%, but some models are predicting as much as 50%. Likewise, President and CEO of the Federal Reserve Bank of St. Louis James Bullard predicted that unemployment could reach as high as 30%, surpassing the record set by the Great Depression. According to Refinitiv, experts predict a consensus decline of 100,000 nonfarm payrolls.
Estimates on when recovery will begin and how quickly it will occur vary somewhat. While many economists are hopeful that recovery could happen soon, others are not so sure. International Monetary Fund Director Kristalina Georgieva believes that recovery may take well into 2021, and even then, it may only be partial.
Initial beliefs by some economists saw the economy following a "V" shaped recovery, where the sudden downturn is matched by a sudden surge once containment has been achieved. The likelihood of this, however, is declining the longer the global economy is, for all intents and purposes, shut down.
- https://www.cnn.com/2020/04/09/economy/unemployment-benefits-coronavirus/index.html
- https://www.nytimes.com/2020/04/09/business/economy/unemployment-claim-numbers-coronavirus.html
- https://www.forbes.com/sites/hershshefrin/2020/04/12/great-depression-economics-101-what-historical-numbers-and-charts-from-the-great-depression-foretell-about-the-economy-and-stock-market/
- https://www.bbc.com/news/business-52236936
- https://www.foxbusiness.com/economy/coronavirus-unemployment-could-hit-post-depression-record-economists-say
- https://www.cnbc.com/2020/04/08/coronavirus-recession-is-unlike-any-economic-downturn-in-us-history.html
- https://www.cnbc.com/2020/04/02/job-losses-in-march-could-be-the-worst-in-a-decade-and-thats-just-the-beginning.html
- https://www.pws.io//unemployment-figures-paint-dour-economic-picture-of-pandemic
- https://www.cnbc.com/2020/04/06/coronavirus-update-a-v-shaped-economic-recovery-getting-less-likely.html
