Unemployment in the U.S. has hit its highest level since 1983—right now it’s at 10.2%—and reportedly may reach 10.5% next year.
While the unemployment rate is not as apocalyptically demoralizing as the Great Depression’s 25% peak jobless rate, it is still troubling to many. And if the Great Depression is any indicator, the numbers may not bounce back right away. “From 1930 to 1940, for more than a decade, unemployment in America averaged 18 percent, and it never dropped below 14 percent. At its worst, in 1933, the unemployment rate was 25 percent,” essayist Ben Wattenberg has said.
The unemployment numbers do not take into account those who have become disheartened and given up on their job search altogether, nor does it accurately reflect the millions of Americans who are working only part-time even though they would prefer to work full-time (the so-called “underemployed” workers).
So what do people out there think of our economic state in the wake of this announcement?
Barack Obama, employed, President of the United States: "I will not rest until all Americans who want work can," he reportedly said earlier today. The President signed a $24 billion stimulus bill today that, among other things, gives tax benefits to new homebuyers and extends existing unemployment benefits for another 20 weeks.
Felix Salmon, employed, blogger for Reuters news agency: Salmon had a strong reaction to today’s new unemployment numbers. “This is truly awful, and makes it obvious why the Fed will keep rates at or near zero for the foreseeable future. You just can’t raise rates when unemployment is in double digits,” he blogged.
Megan McArdle, employed, business blogger for The Atlantic: McArdle sees unemployment as symbolically and psychologically much more crucial than GDP or other economic indicators. “To me, unemployment is a far more important indicator than GDP. Given how rich America is, the misery from losing a job far outweighs a few percentage points of variation in incomes. The NBER may decide that the recession ends next quarter. But the mental recession will be going on for quite some time,” she posted this morning.