Great Depression levels of unemployment in just months
unemployment in the United States was about to skyrocket to a point higher than that reached at the peak of the Great Depression: 32 percent.
That is an astonishing — even incomprehensible — figure. Just four weeks ago, before the coronavirus pandemic plunged us into a recession, unemployment was at 3.5 percent. During the depths of the Great Recession, the highest unemployment reached was 10 percent. Nearly a century ago, in the Great Depression, the worst figure was 24.9 percent — lower if you count people in work relief jobs as employed.
The so-called back-of-the-envelope calculation by the St. Louis Fed is simply staggering. If anywhere close to accurate, it suggests Americans have barely come to grips with the coming economic calamity.
This projection is on the high end and comes with several caveats, but if it's even in the same ballpark then we are looking at an epic, empire-ending, violence-causing catastrophe.
Two weeks ago Treasury Secretary Steven Mnuchin warned of 20% unemployment.
Other predictions are lower, but still higher than the 2009 peak.
Goldman Sachs on Tuesday revised its coronavirus projections, seeing a sharper downturn than originally thought: The bank now sees unemployment peaking at 15% later this year—up from its earlier forecast of 9%...
The University of North Carolina Kenan Institute predicts the unemployment rate will spike up to 11.5% amid small business layoffs, while Capital Economics chief U.S. economist Paul Ainsworth forecasts that it will peak at 12%.