by Robert Romano
25.4 million Americans have lost their jobs since February through mid-April, the Bureau of Labor Statistics reports — 17.3 million who are unemployed, and another 8.1 million who have left the labor force completely — in response to the Chinese coronavirus pandemic as Americans sit home and wait it out.
Although the Bureau tabulates a reported unemployment rate of 14.7 percent, if you count the 8.1 million who left the labor force, too, plus the 5.8 million who were already unemployed, and the number looks more like 18.9 percent.
Either way, that is the highest reported unemployment rate since the Great Depression, and still moving north. As the monthly report was taken in mid-April, it does not take into account all of the initial jobless claims that have taken place since April 11, which total more than 11.4 million.
With so many millions of Americans losing their jobs every week, the data will continue to have a lot of noise as the two sets of numbers bleed into one another until they stop rising, and labor markets finally hit their bottom. Then the totality of the job losses will be known.
Suffice to say, wherever the true numbers are, they are bad enough. And they would probably be much higher if not for $730 billion plus that was given to small businesses via the payroll protection plan that was enacted by Congress.
But we are seeing real devastation with these state government directed closures, and it’s anyone’s guess how long it will be before we hit the bottom and then how long before we ever recover from the equivalent of an asteroid striking the global economy.
Americans for Limited Government President Rick Manning was emphatic in his statement this morning that now it is time to reopen America: “Almost 8.1 million people have left the workforce since February, another 17.3 million people have become unemployed in the same time period, totaling 25.4 million who had jobs but no longer do. This is what it looks like when you shoot your economy in the head over a public health issue, and this is why reopening America is job one for our political leaders.”
Manning added, concluding, “Additional bailouts for states, local governments, business and others do not replace the jobs that a free market economy creates. Further delays in reopening state and local economies will only make the economic disaster worse. And more intractable. America can no longer allow this China originated virus to destroy our economic and societal future. It’s time to get back to work and stop pretending that massive government bailouts can solve the problem.”
That’s right. For as much money as Congress and the Federal Reserve throw at the problem, it will not solve it. For our modern society to function, we need a modern economy and that requires people to work. To all those who still harbor illusions what a Green New Deal or universal income schemes would do to the economy, this is what it would do. It would destroy our economy and remove incentives to work and prosper, and in the process we will no longer be a prosperous society.
We need to reopen the economy, while there still is an economy.
Robert Romano is the Vice President of Public Policy at Americans for Limited Government.