The number of people applying for unemployment benefit in the US over the last four weeks is astonishing – 22 million which represents 13% of the labour force. Some economists are suggesting that it will go above 15% in the next couple of months as the lockdown continues to impact businesses.
“There’s nowhere to hide,” said Diane Swonk, chief economist at Grant Thornton in Chicago told the New York Times. “This is the deepest, fastest, most broad-based recession we’ve ever seen.”
Getting money quickly to people who need it is essential to limiting the economic damage and heading off a prolonged downturn, economists say. Relying on state unemployment offices, however — which had been set up and staffed to deal with record-low jobless rates — has resulted in mammoth delays. New York Times
The graph below represent these figures in a historical context. It would not be surprising if the rate went above that of the Great Depression – 25%. However these estimates would be dependent on a L U V or W recovery – see previous blog post. The graph below is from GZERO.