Unemployment : Since the pandemic situation began, the US has suffered its worst growth numbers in a decade and the worst retail sales report on record. Just about two months ago, the unemployment rate was at 3.5%, a 50-year low. Economist Erica Groshen the former head of the government’s Bureau of Labor Statistics, who now teaches at Cornell University said – “It is historically unprecedented. We have put our economy into a medically induced coma in order to heal it from the pandemic and that has led to the most precipitous loss of jobs seen in any of the modern data.” The report from the Labor Department showed the declines in every sector of the economy. Leisure and hospitality was badly hit hard, with payrolls falling by 7.7 million or 47%. Employers in education and health services cut about 2.5 million positions, while retailers shed 2.1 million.
As Ms Groshen said – “Even a temporary layoff can turn into a permanent one if the business doesn’t survive or if the business has to change its business model so dramatically that it needs different numbers or a different kind of worker”. In an appearance on the Fox News channel, US President “Donald Trump” shrugged off the around 20.5 million jobs lost in the US as totally expected and no surprise.
Bankruptcies had already claimed retailers such as J Crew and Neiman Marcus, as also many firms in the energy sector, where a collapse in oil prices, because in part to a pandemic situation related drop in demand, has worsened the strains. While some states have already started to relax restrictions, re-starting the economy is likely to be difficult, as the workers worry about the risk of infection.
Overall, the unemployment rate was the highest recorded in data back to 1948,Robert Alster- head of investment services at wealth manager Close Brothers Asset Management while the over-the-month jobs decline was the largest reported in data back to 1939. “The scale of the challenge cannot be overstated,” .