The number of new applications for unemployment benefits increased to 33.3 million since March. The new applications represent about 20% of the US workforce. In Europe, a recovery is expected in 2021. However, there is uncertainty. Economy will decline 7.5% according to forecast, a rate that will be slightly higher than in the eurozone. This represents unemployment.
In today’s blog post, we unravel the current economic situation of both places. They are facing a hard time and we believe it is important to know what are the perspectives for the jobless in the nearest future.
The number of people receiving benefits continues to increase in the United States. Despite attempts to reopen some parts of the country’s economy, unemployment continues to rise. The crises affected health services, restaurants and administrative staff, among many others areas.
In the US, the number of people collecting benefits has continued to rise. This is happening despite recent moves to start re-opening in some parts of the country. The impact has been felt across the economy, affecting medical practices, restaurants, and administrative workers among many others.
Millions of workers lost their jobs in April in the United States, raising the unemployment rate to 14.7%. Before the coronavirus pandemic, this rate was only 3.5%.
Since the beginning of the health crisis, the country has had a great worsening in growth numbers, the worst scenario of the decade. Retail had the worst sales result on record. In the companies, the activities were affected so intensely that the loss is equivalent to that of the financial crisis of 2008.
The governments of EU countries are intentionally preventing the economic activity of their countries to contain the virus, as well as in the US. Therefore, it is not possible to contain a sharp drop in the economy.
The current recession has historic proportions, according to the Commission. The impact is uncertain, as it will depend on the duration of the lockdowns. Besides, the economy will be greatly impacted by services such as tourism. Countries that have famous tourist destinations will be most affected by the economic crisis..
The worst predicted drop, which could reach 9%, is in Greece, Spain and Italy. Unemployment will be an inevitable consequence of this impact on the economy. All EU states will see an increase in unemployment, according to the report. In Greece, unemployment may inscrease to 19.9%. In Spain, on the other hand, it can reach 18.9%.
The situation will be even more difficult for young people looking for their first job, according to the Commission. In addition, failed negotiations with the United Kingdom (due to Brexit) could further undermine any recovery.
If the US and EU do not contain the pandemic and the economy remains shut, the unemployment rate would rise further and many of the job losses that we currently view as temporary would likely become permanent.