US Faces Employment Crisis for 6 Million in Management and Finance Jobs... 548,000 Managers at Risk of Unemployment
May Unemployment Rate Predicted at 19.5%, Worst Since Great Depression
8 to 10 Million Additional Unemployed Expected Within a Month
US Considers Additional $1 Trillion Economic Stimulus Plan
[Asia Economy Reporter Naju-seok] It is forecasted that the direct employment shock caused by the novel coronavirus infection (COVID-19) will extend beyond blue-collar (production workers) to white-collar (office workers). Due to the worst employment shock impact, the U.S. government is considering an additional stimulus package worth 1 trillion dollars (1,216 trillion won).
On the 4th (local time), Bloomberg Economics predicted that a secondary employment shock caused by COVID-19 will occur, putting about 6 million additional jobs at risk. Until now, frontline employees in restaurants and hotels have lost their jobs, but going forward, the groups managing them will face unemployment risks. This is because managerial restructuring tends to lag behind frontline workers. Additionally, sectors such as finance, real estate, and professional services are also expected to face unemployment risks due to the changes in daily life caused by COVID-19.
Yelena Shlatyeva, senior U.S. economist at Bloomberg Economics, said, "The employment situation will worsen before it improves," and predicted that "white-collar workers will bear the burden." She forecasted, "(Because employment lags behind economic activity) even if economic activities resume, job losses due to the secondary employment shock will be unavoidable."
Moreover, while retail, restaurants, and leisure industries have so far been heavily impacted, there is a possibility that the shock will expand to finance, real estate, and science and technology service sectors. Alexander Lin, U.S. economist at Bank of America, said, "Companies are adapting to a new reality amid uncertain environments, which may mean fewer jobs are needed than before."
The employment situation in the U.S. is at its worst level since the Great Depression of the 1920s. Bloomberg News expects the U.S. unemployment rate for May, to be announced by the U.S. Department of Labor on the 5th, to reach 19.5%. The April unemployment rate was 14.7%. It is estimated that an additional 8.3 million people will lose their jobs within just one month. Some predict that 10 million jobs could disappear in a month, pushing the unemployment rate to 20.5%.
As the U.S. employment situation worsens to its worst since the Great Depression, the U.S. administration is considering additional stimulus measures. According to Bloomberg News, the White House and Republican leadership are reviewing a stimulus package worth 1 trillion dollars. President Donald Trump is reportedly hoping to pour stimulus funds into large-scale tax cuts and infrastructure construction. Although President Trump has not yet made a final decision, it is expected that the stimulus package will pass after the 20th of next month, considering the congressional schedule.
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