The US jobless rate may peak “north of” 20 per cent in May or June before the economy starts to recover from coronavirus-related shutdowns in the second half of 2020, a top White House adviser said.
Kevin Hassett said on CBS's Face that Nation that the estimate was "not science as much as arithmetic", based on the massive numbers of people filing initial unemployment claims at the moment.
The April jobless rate tripled to 14.7 per cent, the highest since the Great Depression era of the 1930s. And it’s only set to worsen in May, as job cuts spread further into white-collar work.
Mr Hassett, the former chairman of the Council of Economic Advisers, recently returned to the White House to advise on virus-related matters.
The Trump administration and Congress have “built a bridge to the other side” of the Covid-19 pandemic with up to $9 trillion in economic stimulus programmes so far, he said.
“Right now we’ve bought some time,” he said. “Nobody knows for sure if it’s going to work,” he said.
Mr Hassett said the administration is preparing for either scenario - that “more bridge” will be needed, or that the economy will start to recover more quickly.
President Donald Trump declared on Friday he is in “no rush” for Congress to pass more stimulus measures to bolster the economy, just hours after the Labour Department reported that an unprecedented 20 million jobs were lost in April.