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This certainly feels real to me. Yesterday, I was laid off from my job at Easypost. We had a very big and very painful layoff because my company took on way too much leverage. The circumstances of COVID19 were tough to foresee but I really wish we hadn't taken on so much debt while times were good. I have experience in Go, Ruby, Python and I'm excited to hack again.
The unemployment rate isn't even close to the 10% we saw after the '08 recession. Only about half. Does that mean that twice as many people are going to become unemployed, than are right now?
That said, the past two weeks the claims seem to have hit their processing limit, with people still not getting through - it's guaranteed to continue rising for the rest of the month, past the numbers I have here.
[0] https://fred.stlouisfed.org/series/ICSA
[1] 3.3 million + 6.8 + 6.6 = 16.7 million, 16.7 / 160 million (number I've seen for estimated working-age people) = 10.4%, 10.4% + 4% (previous unemployment rate) = 14.4%
Quick edit, unemployment rate is updated monthly here: https://fred.stlouisfed.org/series/UNRATE - based on when it updated, that 3.3 million is already included in the 4.4%, so actually more like 4.4% + ((6.8 + 6.6) / 160) = 12.8%-ish (and more than likely still rising)
The unemployment rate isn't even close to the 10% we saw after the '08 recession. Only about half. Does that mean that twice as many people are going to become unemployed, than are right now?
And because of that, these recessions and depressions are far less devastating than they used to.
Of course I'm saying this living in a rich country that does have all of these amenities; in poorer countries that don't yet take care of their poor (and possibly the US that chooses not to take care of its poor), things may still feel like the 1930s. But in a rich, well-organised country, there's really no need for that anymore. We can easily get through this is we want to. Skip a vacation, buy a luxury item less, make sure the poorest don't fall through the cracks (and there will be more cracks of course), and we'll be fine. The misery is mostly a political decision.
The unemployment rate isn't even close to the 10% we saw after the '08 recession. Only about half. Does that mean that twice as many people are going to become unemployed, than are right now?
The unemployment rate isn't even close to the 10% we saw after the '08 recession. Only about half. Does that mean that twice as many people are going to become unemployed, than are right now?
The important question is whether the recession due to the lockdown (which is at least useful for stopping the virus) will continue after the virus has passed and the lockdown is lifted.
There will be huge shift in structure of business. Many small mom and pop shops are not coming back. Big chains, and franchises survive. Permanent changes in customer behavior. Many people with resistance and habits against 'new ways' are forced to learn internet shopping and delivery. Their habits can change permanently.
I don't get what the point of still using the term "recession" is. Even if it's temporary, this is a full-blown depression right?
Technically, I think it even takes 2 quarters to call a recession.
But I get your point... even if we don't have the stats for six months or two years, we all know where this is going. It's just the standard terminology doesn't help right now.
I find myself less interested in whether or not something is a recession or not. I mean, sure, the numbers of the economy are going down, but the big numbers don't necessarily mean much for anyone's personal life. Of course it can; losing your job is no fun. But the big reason why the Great Depression was so bad, is that we didn't have any social security back then. Unemployed meant having no income at all. No health…
I don't get what the point of still using the term "recession" is. Even if it's temporary, this is a full-blown depression right?
How is it a depression if it's only been a few months? Also the IMF article predicts a 3% contraction for 2020 and a 5.8% growth in 2021, so by what definition is this a depression?