“The fact is, right now, 30 million people have filed for unemployment insurance, the unemployment rate is probably up around 19 percent. And those numbers are as startling as anything we’ve seen since the Great Depression,” Kevin Hassett, the adviser, told reporters outside the White House on Thursday.
The unemployment rate hit 24.9 percent in 1933 during the Great Depression, a worldwide depression that heavily impacted the United States. Hassett said his prediction is for next week’s adjusted rate.
More than 3.8 million workers filed unemployment claims last week, according to data released Thursday, bringing the total to over 30 million in the past six weeks. The adjusted unemployment rate climbed to 12.4 percent.
The rate is the number of jobless people who are available for and seeking work.
Hassett said the economy has essentially been shut down to try to stop the spread of the CCP (Chinese Communist Party) virus, a novel coronavirus from China. Governors across the nation imposed harsh measures in March. Most issued orders mandating people largely stay at home and the vast majority forced businesses deemed nonessential to close.
Governors across the nation are beginning to relax the measures and Hassett predicts a strong rebound if the virus wanes.
“I think that if the virus is mostly gone, then everybody will get back to their normal lives and the baseball stadiums will be filled with fans and so on,” and workers will feel safe enough to go back to work, he said.
“And if the virus is still lingering or even staying at about the level that we see right now, then activity will stay lower,” he added.
The Congressional Budget Office projects the unemployment rate to average close to 14 percent during the second quarter from factors relating to the COVID-19 pandemic before hitting 16 percent in the third quarter and dropping to 11.7 percent in quarter four.
Analysts believe economic activity will begin to increase in the third quarter “as concerns about the pandemic diminish and state and local governments ease stay-at-home orders, bans on public gatherings, and other measures restraining economic activity.”
Challenges in the economy and labor market are expected to persist for a period of time, the office said.
Hassett said Trump has directed his economic advisers to make plans based on every eventuality.
Speaking to reporters inside the White House later Thursday, Trump said there’s “tremendous pent-up demand” as he predicted “a great third quarter.”
“It’s going to be a transition, so when I say great, I think the transition is going to be really terrific and we’re going to take it into the fourth and I think we’re going to have, potentially, a great fourth quarter,” he said.
“I think next year is going to be a spectacular year, in terms of growth, in terms of bringing our country back.”
The recession happened because America “got hit by a vicious virus that should have never been allowed to escape China,” he concluded.