Goldman Sachs now expects US unemployment to hit 15%
Goldman Sachs predicts US unemployment at 15%
Bank experts suggest that the return to the usual situation will occur only after the emergence of an effective vaccine against coronavirus
The coronavirus is likely to hit the U.S. economy four times harder than the 2008 financial crisis, and the country will have the highest unemployment rate since World War II. This forecast was made by the investment bank Goldman Sachs.
The overall US unemployment rate will hit 15 percent, “and even that does not fully reflect the severity of the situation,” as many workers will be unemployed but not looking for jobs, hoping for a resurgence of economic activity, Wall Street financial firm predicts..
This will be accompanied by a decline in US GDP by 11 percent compared to last year and 34 percent on a quarterly basis. Both numbers are significantly worse than during the 2008 financial crisis, Goldman Sachs said.
The analysis does not indicate the time frame in which the American economy could restart after the introduction of social distancing, which stopped the operation of all industries deemed immaterial..
Ian Hatzius, chief economist at Goldman Sachs, said the return to business routine is unlikely to happen until the vaccine is proven to work..
“It may be possible to at least partially make up for the lost volume of the economy through a sharp increase in testing and limited changes in business practices that will reduce the risk of infection,” he added..
He paid particular attention to manufacturing and construction, in particular to the automotive industry, where, he said, capacity utilization could rise from 25 percent in April to 70 percent in May..
As sectors of the economy gradually return to operating mode, this should lead to a recovery in economic growth, which, according to Hatzius, will be unprecedented in the United States..
He predicted growth in the third quarter would be 19 percent over the second, and there would be another jump in the fourth – this time 12 percent..
Russian service &# 171; Voices of America&# 187;
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