The unemployment numbers are out today, with the reported unemployment rate being 14.7%:
CNBC – The impact of the coronavirus-induced economic shutdown tore through the U.S. labor market in April at historic levels, slashing 20.5 million workers from nonfarm payrolls and sending the unemployment rate skyrocketing to 14.7%, the Labor Department reported Friday.
Both numbers easily smashed post-World War II era records and help reflect the profound damage done through efforts used to combat the virus.
Economists surveyed by Dow Jones had been expecting payrolls to shed 21.5 million and the unemployment rate to go to 16%. April’s unemployment rate topped the post-war record 10.8% but was short of the Great Depression high estimated at 24.9%. The financial crisis peak was 10% in October 2009.
A more encompassing measure that includes those not looking for work as well as those holding part-time jobs for economic reasons also hit an all-time high of 22.8%. That reading may be a more accurate picture of the current jobs situation as millions of workers are being paid to stay home and thus not willing or able to look for new jobs.
The jump in the “real” unemployment rate reflected a plunge in the labor participation rate to 60.7%, its lowest level since 1973.
The April numbers represent a stunning reversal for a jobs market that had been on fire only two months ago. February saw a payroll gain of 230,000 that was high for a recovery that lasted nearly 11 years. The month’s total was revised down 45,000. March’s initially reported loss of 701,000 also was pulled down further, to 870,000.
According to Bloomberg, there were problems with the data today resulting in a lower unemployment rate than expected:
Today's jobs numbers were probably even worse than reported. @mckonomy explains why https://t.co/dZH1SgVX12 pic.twitter.com/2yGbDkNg0S
— Bloomberg TV (@BloombergTV) May 8, 2020
They report, via the Bureau of Labor and Statistics, that the household survey’s response rate was about 13% lower than normal, which means the numbers aren’t as accurate as they normally would be. Secondly, there was a miscoding of people who are out of work because of the coronavirus. If they coding had been correct, the unemployment rate would have been five points higher at 19.7%.
In the writeup above, CNBC suggest that the 22.8% real unemployment number might be a more accurate showing. That seems to better jive with the number Bloomberg reports should be close to 20%.
According to Jennifer Jacobs, Trump responded to the new unemployment report saying “It’s fully expected, there’s no surprise, everybody knows that. Somebody said, oh, look at this, well, even the Democrats aren’t blaming me for that. But what I can do, is I’ll bring it back.”