Unemployment Hits 14.7%…First Time Since The Depression
The Covid-19 pandemic led to record jobs lost in April sending the unemployment rate to its highest in nearly a century.
According to Business Insider:
Employers cut 20.5 million payrolls in April, marking the largest-ever one-month contraction, according to a Friday report from the Labor Department. That's roughly 25 times the worst monthly decline seen during the last recession, from 2007 to 2009. It also dwarfs the previous record, set in 1945 around the end of World War II.
Meanwhile, the unemployment rate surged to 14.7%. That's the highest since the Great Depression of the 1930s, according to Labor Department data dating back to the 1940s, and National Bureau of Economic Research figures before that.
Just two months prior, in February, the unemployment rate was 3.5%, a roughly 50-year low.
This just shows just how rapidly the coronavirus pandemic has devastated the labor market and pushed the US economy into a recession since states sent workers home and told consumers to practice social distancing to curb the spread of the virus.
The government has gone to tremendous lengths to curb economic fallout. At the end of March, President Donald Trump signed the $2 trillion Cares Act into law, expanding unemployment benefits, sending direct checks to Americans, extending aid to beleaguered industries, and giving small business loans to protect payrolls.
The Federal Reserve has also already allocated trillions of dollars to help state and local governments and businesses across the country. The central bank has vowed to continue its stance to do whatever it takes to protect the economy.
As shocking as the headline unemployment number is, economists caution that it's likely an undercount of economic pain. That's at least partly because the Bureau of Labor Statistics doesn't include workers who are unemployed but not actively looking for a job in the headline unemployment rate.
Economists don't expect record-high unemployment to return to pre-coronavirus lows anytime soon.