March unemployment numbers are ‘tip of the iceberg’ Valley economist says
PHOENIX — The U.S. reported the loss of 701,000 jobs in the month of March on Friday.
That metric is the worst in a single month since the Great Recession in 2009 and comes as a result of the coronavirus outbreak throughout the country.
“The unemployment numbers today are kind of meaningless,” Valley economist Elliot Pollack told KTAR News 92.3 FM on Friday. “The unemployment numbers and the unemployment rate because it’s just the tip of the iceberg. You get a better idea from the initial claims data because that’s much more recent.
“The April numbers, which will be in a month from now, will really be the key because that will have taken place after coronavirus really took hold. The data in March is when things were starting to fall apart, but they don’t really reflect how bad things are.”
Some economists expect that as many as 20 million Americans could lose their job, which would put the country’s unemployment rate at around 15%, the highest since the 1930s following the Great Depression of 1929.
The unemployment rate went from a 50-year low of 3.5% to 4.4% on Friday, but Pollack says that Arizonans need to be ready for the long haul.
“It’s going to get a lot worse. The unemployment rate is going to get a lot worse.” Pollack said. “But it really is almost meaningless because the real issue is what happens when this is all over?
“Whether people have been financially secure enough to really be economically viable at the other end of this and the $2.3 billion package that was passed last week by Congress goes a long way in doing that. Some people will fall through the cracks, but there will probably be modifications in the program so most people can remain economically viable.”
Pollack added that the unemployment package and small business package will help aid those from hardship that otherwise wouldn’t be able to survive.
However, when asked about a timeframe of when Arizona’s economy will be back up and running, Pollack said that nobody knows and that picking a date is just a “feel-good thing.”
And even with the uncertainty of how long COVID-19 will keep businesses closed, Pollack still has confidence that Arizona’s economy will be able to bounce back quickly.
“The major issue is how people fare during this thing and whether they come out the other side financially whole,” Pollack said. “If they do, I don’t think it’ll be a V, but it’ll start like V and level off and be more like a U.
“If it were not for this package that was passed last week, it would have been kind of an L where it would take a long time for those people who were unemployed to really get financially whole again. Whereas now, I don’t think it will so I think the recovery will be relatively fast.”
So how exactly will Arizonans begin to resume working once the coronavirus restrictions are uplifted?
Pollack says that people should go to work as soon as possible, but should do so in “launches” in order to limit the spread of the virus.
He says that those who have contracted COVID-19 and survived it should go first, followed by those less vulnerable or willing to take the risk.
“You have to keep a good percentage of the population sequestered until this thing gets under control,” Pollack said.
KTAR News 92.3 FM’s Jeremy Foster contributed to this report.