How Bad Is Unemployment?

[Ad Orientem]

Detailed discussion at the NYT...
https://www.nytimes.com/interactive/202 ... e=Homepage

Bottom line; the 14.7% number is certainly low. The real number for April is close to 20%. That does not include what has happened in May and there are anticipated corrections for the first quarter coming as well. So unemployment is at its highest level since 1940 when it was hovering around 20% until FDR and Congress reinstated the military draft in October. John Williams over at Shadow Stats (http://www.shadowstats.com/) puts unemployment for April at 19.5%. My SWAG (scientific wild ass guess) is that we will probably hit bottom around mid summer with unemployment at >25%. Due to the ripple effects of mass unemployment and the need for continued social distancing likely to last well into 2021 I am not seeing much that supports Wall Street's expectation for a V shaped recovery. One can never be sure about the future, but part of my definition for a depression is unemployment of 20% or higher, with sustained unemployment above 15% for at least two years. At this point, I think that is more likely than not.

On a sad note one of my favorite chain restaurants, Sweet Tomatos, won't be reopening. Add another 4000+ to the ranks of the unemployed. We will be seeing a lot more of this.

[vnatale]

Detailed discussion at the NYT...
https://www.nytimes.com/interactive/202 ... e=Homepage

Bottom line; the 14.7% number is certainly low. The real number for April is close to 20%. That does not include what has happened in May and there are anticipated corrections for the first quarter coming as well. So unemployment is at its highest level since 1940 when it was hovering around 20% until FDR and Congress reinstated the military draft in October. John Williams over at Shadow Stats (http://www.shadowstats.com/) puts unemployment for April at 19.5%. My SWAG (scientific wild ass guess) is that we will probably hit bottom around mid summer with unemployment at >25%. Due to the ripple effects of mass unemployment and the need for continued social distancing likely to last well into 2021 I am not seeing much that supports Wall Street's expectation for a V shaped recovery. One can never be sure about the future, but part of my definition for a depression is unemployment of 20% or higher, with sustained unemployment above 15% for at least two years. At this point, I think that is more likely than not.

On a sad note one of my favorite chain restaurants, Sweet Tomatos, won't be reopening. Add another 4000+ to the ranks of the unemployed. We will be seeing a lot more of this.

So I take it that you don't agree with a certain president who repeatedly contends that the 3rd quarter is going to be a turnaround time while we are going to see a 4th quarter "like you won't believe!"?

Vinny

[Ad Orientem]

Detailed discussion at the NYT...
https://www.nytimes.com/interactive/202 ... e=Homepage

Bottom line; the 14.7% number is certainly low. The real number for April is close to 20%. That does not include what has happened in May and there are anticipated corrections for the first quarter coming as well. So unemployment is at its highest level since 1940 when it was hovering around 20% until FDR and Congress reinstated the military draft in October. John Williams over at Shadow Stats (http://www.shadowstats.com/) puts unemployment for April at 19.5%. My SWAG (scientific wild ass guess) is that we will probably hit bottom around mid summer with unemployment at >25%. Due to the ripple effects of mass unemployment and the need for continued social distancing likely to last well into 2021 I am not seeing much that supports Wall Street's expectation for a V shaped recovery. One can never be sure about the future, but part of my definition for a depression is unemployment of 20% or higher, with sustained unemployment above 15% for at least two years. At this point, I think that is more likely than not.

On a sad note one of my favorite chain restaurants, Sweet Tomatos, won't be reopening. Add another 4000+ to the ranks of the unemployed. We will be seeing a lot more of this.

So I take it that you don't agree with a certain president who repeatedly contends that the 3rd quarter is going to be a turnaround time while we are going to see a 4th quarter "like you won't believe!"?

Vinny

.

[Ad Orientem]

On a sad note one of my favorite chain restaurants, Sweet Tomatos, won't be reopening. Add another 4000+ to the ranks of the unemployed. We will be seeing a lot more of this.

IL Restaurants to stay closed thru June: Expect few survivors

[mathjak107]

The company I worked for one day a week got their bail out money ...they are bringing back 340 of the 350 employees...they are alternating with half working from home and half in the office , then switching the following week...I did not get called back yet but that likely won’t happen until everyone is in the office

[Smith1776]

Pretty bad it seems.

EmployRecessionApr2020.png (134.18 KiB) Viewed 2777 times

[mathjak107]

A lot is very different..many are just temporarily furloughed , many don’t want to go back because the 600 and unemployment is more than they make so companies are letting them wait ...so we can’t judge from this crazy number yet.

340 in my company went back to work in one day

[pp4me]

My daughter went back to work as assistant manager of a store on Tuesday. She had been laid off for about 6 weeks. Good thing because she wasn't able to file for unemployment benefits due to state computer system crashes until just last week. So she would have been part of the under count for the first 5 weeks but now she's part of the over-count since she has, in fact, returned to work (with no way to report that fact to the unemployment office because the system still crashes).

So I would expect the unemployment figures to be a lagging indicator for a while because we won't know how many people are in this kind of situation.

But I'm sure a lot of jobs are never coming back. We just don' know how many. Like everything in this godawful mess it's all a big ? at this point. As Trump likes to say a lot "We'll see what happens".

[ochotona]

On a sad note one of my favorite chain restaurants, Sweet Tomatos, won't be reopening. Add another 4000+ to the ranks of the unemployed. We will be seeing a lot more of this.

Darn I loved their soups! And super convenient next to the gun store and gold dealer on Interstate 10!

Gold bullion, chicken bullion, and bullets...

[WiseOne]

Some of the jobs will come back very quickly when businesses are allowed to reopen...but naturally, not all since many businesses won't make it until then. So we just don't know what the curve will look like. This is an externally-inflicted injury, as opposed to a systemic issue. i.e. there were no fundamental business reasons for these jobs to be lost.

As far as our investments go...the stock market recovery was way faster than the employment recovery after the 2008 recession, and it's looking like that will be the case again here. Unfortunately it will only fuel the fires of those calling for introduction of a wealth tax, especially if Biden wins the election. That would be devastating for a recovery no matter how it's measured.