Business Report: Worst Unemployment Rate Since Great Depression
Q: The jobs report for April was announced Friday. What's your reaction and could we see even more losses?
A: We're going from 3.5% unemployment in February to 15% today in less than 45 days. All of the jobs that were gained since the last recession have now been officially lost. The one positive dimension to the unemployment number is 78% of filers for unemployment benefits stated that they felt their job was lost temporarily. That they would be able to find work in a reasonably good period of time. The May jobs report, which will be announced in early June, the question becomes is it going to top 20%, which is very likely.
Q: Phase 1 of reopening the state and local economy begins this weekend. Who benefits from this first step, and will it make a noticeable difference toward improving our economic situation?
A: As we go through this, the question becomes how easily will companies absorb all of the workers? And there's a couple of considerations here. First, with the government supplement to unemployment benefits, the average worker is probably earning more than he or she was while working a job at minimum wage. So the incentive to go back to work where it's not going to be stable is a consideration.
And right now, 68% of consumers are hesitant that they're ready to engage in broader shopping and commerce. That has to change. Irrespective of fingerpointing at the state or federal level, the two things that will really build confidence is the amount of testing to know what percent of individuals have the virus. And then the antibody testing to understand how many people have actually had it that weren't aware.