By Aaron Miller-
The U.S economy is experiencing an improvement in the job market after a remarkable rise in employment by 2.5 million in May and the jobless rate declined to 13.3%, according to data Friday from the Labor Department .
The result was far better than economists had hoped for, and indicated an economic transformation at hand.
Economists surveyed by Dow Jones had been expecting payrolls to drop by 8.33 million and the unemployment rate to rise to 19.5% from April’s 14.7%. If Wall Street expectations had been accurate, it would have been the worst figure since the Great Depression.
The surprise news follows the loss of 20million jobs in April, when unemployment hit 14.7%.The stock market eventually came strong following the report as the Dow Jones Industrial Average gained 800 points as of 11 a.m. ET. Government bond yields raced higher as well, with the benchmark 10-year Treasury most recently at 0.91%.
The improvement is relative and does not completely address the economic challenge America faces of rectifying the potential long term issues it faces. The improvement is significant, but insufficient.
Fears that America was heading for a recession have not yet disappeared, but the recent news provides some hope that as businesses re-open the economy will be fully revived.
In February the unemployment rate was just 3.5%. A decade’s worth of gains made in the labor market since the last recession have been erased in just three months.
All 50 states are now easing quarantine restrictions, and people are now returning to work
Weekly unemployment claims have reduced, raising hopes of eventual economic recovery , but uncertainty about the future remains. The state of the economy will also depend on whether the raging virus that has claimed so many lives is not exacerbated by the ease of the lockdown and return with a fury in the winter that worsens the economy.
While the unemployment rate remains well above the 10% peak in the last recession, Donald Trump was quick to hail victory. “Great going President Trump (kidding but true)!” he wrote on Twitter. Trump will hold a press conference on the figures this morning.
The US pandemic initially hit the leisure and hospitality industry hardest, now the damage is spreading further, states are running out of cash and companies are burning through their stimulus checks.
The unemployment rate is comfortably above the 10% peak in the last recession, leading Donald Trump to hail victory. “Great going President Trump (kidding but true)!” he wrote on Twitter. Trump will hold a press conference on the figures this morning.
The duration of the coronavirus recession and the eventual state of unemployment in the U.S can only be speculative at present. Some have estimate as long as a decade to return the economy to its orignal state prior to the epidemic, but optimists believe the return to normality could be far more rapid provided further episodes of a virus killer do not reemerge any time soon.
Americans have been greatly impacted by this virus,its psychological effect potientally more lasting for the many thousands who are still very much apprehensive of mixing in public, let alone returning to work.
Many more Americans who are accustomed to the unpredictability of life manifest from some of the unthinkable violence that takes place in a country filled with ll manner of drama, see the coronavirus as just another killer which is random in its selection of victims, but targets mainly those with other underlying health issues.
The many scenes of protests for the lockdown to cease evidences just how split Americans are on the idea of putting the country on hold on account of a virus so many could not personally relate to. There are no shortage of people in America who consider the virus to be just a strong flu killing people with weak immune systems, and would much rather get on with life and work, and let those struck by the virus handle their own fate.
Families who have lost loved ones or close friends will have a completely different take on the dangers posed by the coronavirus. The value of money for them has probably lost its value in the face of life they have seen just go in a flash.
Until a reliable vaccine is found, the chances of another cycle of apocalyptic deaths is one nobody really knows. The hope is that this time America is better prepared, and the economy doesn’t have to take a hit as hard as it did this time.