Permanent job losses in US could reach 8.7 million – how financial repression and inflation can ease UK public debt

26 August 2020 (Last Updated August 26th, 2020 07:42)

26 August

The effects of Covid-19 pandemic have been multi-fold from shutting down businesses, causing widespread unemployment to a global healthcare crisis.

Adam Ozimek, chief economist at Upwork, shared an article on how the Covid-19 induced recession is leading to permanent job losses in the US similar to the Great Recession.

The rise in unemployment rate during March and April was considered to be temporary.

However, in July, approximately 33% of employees who were furloughed were permanently laid off, according to data from Gusto, a payroll and benefits company.

A total of 3.7 million people were unemployed in July, according to official figures from the Labour department.

By the end of the year, the figure is expected to rise to between 6.2 million and 8.7 million, which is close to the 8.6 million unemployed during the Great Recession.

Long-term unemployment may lead to slow economic recovery and have the most impact on the minority communities of the society.

Meanwhile, George Magnus, a macroeconomist, shared an article on the expected rise in inflation in the UK.

Magnus argues that a combination of financial repression and inflation may be the best way to address public debt.

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