The economic fallout from the coronavirus lockdowns continues to worsen.
In a series of interviews over the weekend, senior White House economic adviser Kevin Hassett revealed that the United States’ unemployment rate may increase to around 20% before things start to improve, The Hill reports.
It could happen
On Sunday, Hassett made two television appearances where he spoke about the economy. One took place on CNN’s State of the Union.
“Just looking at the flow of initial claims that is looks like we’re probably going to get close to 20 percent in the next report,” he said, referring to the unemployment rate.
Hassett’s other appearance was on CBS News’ Face the Nation where he made a similar prediction.
“I’m looking for rates north of 20 percent,” said Hassett. “Part of this is not really science as much arithmetic because we get the initial claims for unemployment insurance each week and the survey week was the 12th and so between now and the next month we’ll watch the claims come in and be able to pretty much guess what the unemployment rate will be and how many jobs will be created.” Watch below:
— Face The Nation (@FaceTheNation) May 10, 2020
This all, of course, is the result of the policies that have been put in place to stop the spread of the coronavirus. Such policies may have been effective in this regard, but they have also been effective at crippling the American economy.
Since the outbreak of the coronavirus in the United States, unemployment has leaped from 4.4% in March to 14.7% in April.
In April, the U.S. economy saw a loss of 20.5 million jobs, setting an all-time one-month record. And, unfortunately, Hassett says, economically, things are still going to get a bit worse before getting better.
“I think you could expect to see jobs probably drop around May or June,” he said. “The fact is that we’re burning up initial claims for unemployment insurance right now at a rate of about 3 million a week running through the rest of the month and that is where the extra unemployment comes from.”
After that low point is reached, Hassett said the economy will start to turnaround for the better, but he doesn’t expect that to be until mid-summer.
“I would guess middle of summer is when we’re going to start to go into the transition phase,” he said, going on to express his hope that at that point we would start to see “very strong” growth.