As the US economic crisis worsens, the number of unemployed people will only increase with the passage of time. This has become evident via statistics that show that another 4.4 million Americans filed for unemployment in the past week.
Workers in the US are filing jobless claims at a historical rate as statistics revealed that nearly 26 million Americans have filed for unemployment in the last five weeks.
US economic crisis
These numbers far surpass the number of unemployed people during the peak of 2008’s great recession.
The rising levels of unemployment are a serious warning about the health of the economy. The US economy is dependent on consumer spending as it makes up to 70 percent of the entire GDP. Furthermore, high levels of unemployment create a desolate economic outlook.
If things continue to proceed as they are right now, bankruptcy will continue upwards of the supply chain, and the US economic crisis might overshadow the coronavirus pandemic in severity.
As economists suggest, we are currently stuck in a deflationary crisis that is caused by depressed demand. Due to the decreased demand, companies have been seeing lower profits, which caused workers to be laid off as a result.
If the lockdown continues, the total number of jobless people will continue to soar. Although President Donald Trump is eager to reopen the economy, there is little he can do as Coronavirus is still causing deaths of over 2,000 people daily in the United States. With such statistics, planning to reopen the economy seems difficult to implement.
While the IMF is optimistic about a V-shaped recovery, others might not be just as optimistic. The IMF hopes to see a sharp bounce in 2021. However, it seems to be becoming more unlikely as things continue to deteriorate.
Feature image by pixabay.