A Look At The U.S. Unemployment Rate, Now At Its Worst Since Great Depression
SCOTT SIMON, HOST:
The unemployment rate in the United States is now at 14.7%, the worst since the Great Depression. Women, Hispanics and African Americans are especially hard-hit. Hospitality and retail are two sectors that see especially sharp decline. William Rodgers teaches public policy at Rutgers, and he is the chief economist at the Heldrich Center there. Mr. Rodgers, thanks so much for joining us this morning.
WILLIAM RODGERS: Thanks for having me. I wish it was on a much more positive occasion.
SIMON: Yes, in fact, we do, but thank you for making the time for us. How do you explain - how do we explain that right after those soul-piercing unemployment numbers were announced yesterday, the markets rallied?
RODGERS: Yeah, it's very, you know, very perplexing for, you know, for most people - in particular, people on Main Street who are having a very, very different experience. And, you know, the way I explain it to my students is, you know, the stock market is really capturing current value and future value. And underlying that is people's expectations, the market's expectations about what the Federal Reserve is going to do, what Congress is going to do. And whenever there is new information, such as this jobs report, it actually, I think, can send that signal that, oh, you know, the Federal Reserve is going to continue or either strengthen its resolve to help to maintain stability, or that this is going to - this report will put more sort of wind behind the back for those who want Congress and the administration to, you know, to begin now talking about what we have to do after the summer. Because this is that - even the new normal is going to be in a situation where economic growth is going to be challenged.
SIMON: White House economic adviser Larry Kudlow said yesterday the White House won't talk to Congress about any more aid or stimulus because states are now reopening - want to see what effect that has on the economy this month. How does that strike you?
RODGERS: That's just simply irresponsible. I respect Larry. When he was with CNBC, he interviewed me a few times. But, unfortunately, I just have to really, vehemently disagree with him. That's just irresponsible. That - you know, yesterday's jobs report clearly sent the message that, you know, this is not a two-alarm fire. It's a three-alarm fire.
The other thing about yesterday's jobs report - that survey was done the second week of April, all right? And so since then, we've had another, you know, I believe 12 million to 15 million or 16 million Americans apply for unemployment insurance. So, you know, the BLS workers - they're awesome. They're great. I've worked with many, many of them. So this is not a criticism to them. But the jobs report that came out yesterday, or Friday - that is, you know, backward looking. And, you know, the unemployment insurance claims are a better leading indicator. And so based upon that, they need to be talking.
SIMON: Mr. Rodgers, there was some feeling that we had just about full employment until the coronavirus hit. And a lot of people seem to be counting on the economy coming back pretty quickly, or at least jobs coming back pretty quickly. Are you as confident? Are a lot of these job losses going to be not just temporary?
RODGERS: Well, it's - not so much of it is about temporary versus permanent loss. It's really the pace of change and the pace of the recovery that I think the administration - that they're - and I understand their position. You know, they're hoping it's going to be a V-shaped recovery - that is the sharp downward trend and then the rapid recovery - versus a Nike swoosh, a long drop - a quick drop but then a long recovery. And that recovery really is going to hinge upon, one, if states open up too quickly. It's akin to possibly sending kids back to school when they're not fully healthy, and they either have a relapse or they get their teachers and their peers infected. So that's the debate that we're having right now. My sense is it's going to be more of a Nike swoosh as I see more data.
SIMON: William Rodgers, thanks very much for being with us.
RODGERS: Thank you.
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