In May 2020, some 21 million Americans were unemployed — down from 23 million in April 2020. More than 25 million U.S. households indicated they often or sometimes didn’t have enough food to eat over the course of the first week in May 2020, according to data published by the U.S. Census Bureau.
Painful as it was for those Americans, it wasn’t shocking considering the U.S. was in the midst of a recession caused by the coronavirus pandemic — or was it?
‘The economy started getting less bad after April 2020. It was, and in many respects is, still well below where it should be.’
— Jason Furman, former chairman of the Council of Economic Advisors under the Obama administration
Turns out the recession which began last February ended just two months later— making it the shortest economic downturn in U.S. history, the National Bureau of Economic Research’s Business Cycle Dating Committee announced on Monday.
In baseball terms, the economy was taken off the “injured list” in May. But was the economy completely healed and ready to go to bat?
In short, no.
“In determining that a trough occurred in April 2020, the committee did not conclude that the economy has returned to operating at normal capacity,” eight economists on the committee said in a statement published Monday.
They explained that the recession concluded in April 2020 because that’s when the economy reached its lowest point in terms of jobs and output.
‘The economic downturn has not fallen equally on all Americans, and those least able to shoulder the burden have been hardest hit’
— Federal Reserve Chairman Jerome Powell
“The economy started getting less bad after April 2020,” Jason Furman, former chairman of the Council of Economic Advisors under the Obama administration, tweeted on Monday. “It was, and in many respects is, still well below where it should be.”
Some 9.3 million Americans remain unemployed, according to the June unemployment report published by the Bureau of Labor Statistics. Some 4 million people have been unemployed for more than 27 weeks — that’s 2.9 million more people than there were in February.
Some 7.5 million Americans aren’t working in order to take care of a child who isn’t attending school or daycare in person, the Census Bureau data collected from June 23 through July 5 indicates.
Diane Swonk, chief economist at accounting and advisory firm Grant Thornton, challenged the Business Cycle Dating Committee’s conclusion.
She tweeted the following on Monday:
Earlier this year, Federal Reserve Chairman Jerome Powell told U.S. senators that the economic recovery “remains uneven and far from complete.”
“The economic downturn has not fallen equally on all Americans, and those least able to shoulder the burden have been hardest hit,” Powell said during testimony he gave on February 23. “The job losses were heavily concentrated on public-facing, service-sector jobs. Those tend to be more skewed towards lower-paid, and in many cases, minorities and women.”