
April Unemployment Rate Rose to a Record 14.7% - ericmay
https://www.wsj.com/articles/april-jobs-report-coronavirus-2020-11588888089
======
lettergram
My prediction is we hit (or in reality, have already hit) 48 million
unemployed (~30%) in the U.S.

It’s just many aren’t filing for unemployment because they can’t get through
OR they decided not to apply (due to receiving stimulus / severance).

Full predictions / data here:

[https://austingwalters.com/covid-19-u-s-fatalities-
economic-...](https://austingwalters.com/covid-19-u-s-fatalities-economic-
predictions/)

The gist is that retailers are going bankrupt (see J. Crew & Neiman Marcus)
and places like Macy’s are furloughing most of the staff. Airlines are
similarly hit, and I can go on (it’s linked above). If retail and hospitality
(and similar sectors) shrink by 80% for 6 months that’s a massive number of
unemployed - 33 million.

Further, recruiting and marketing has cut staff at most non-FAANG places (see
Uber, Lyft, AirBnB, etc), This will start to impact the tech industry. Banking
is going to see massive defaults in the next 3-6 months... the list goes on.

Easy to see unemployment hitting 30% in the next 2 months.

~~~
vonmoltke
> It’s just many aren’t filing for unemployment because they can’t get through
> OR they decided not to apply (due to receiving stimulus / severance).

The BLS numbers have nothing to do with unemployment filings. They base their
unemployment numbers off two surveys:
[https://www.bls.gov/news.release/empsit.tn.htm](https://www.bls.gov/news.release/empsit.tn.htm)

People not looking could skew the numbers, but since the vast majority of the
job losses in the report are considered temporary layoffs, and since the BLS
always counts temporarily laid off people as "unemployed" regardless of other
criteria, I don't expect it to be a significant factor.

~~~
12xo
I was once one of these panelists. As one, I represented 0000’s of other
people via their extrapolation. While my experiences at the time (2009) were
common, they did not represent that of many of my fellow unemployed colleagues
and friends. In other words: these surveys are guesses. Nothing more... take
them as estimates only and know that the truth is always different.

~~~
mywittyname
Is there a better alternative? I understand your criticism, but this is not a
dataset that can be reasonably obtained in its entirety, so sampling is
basically required.

Their methods have been largely consistent over the years, so even if it isn't
complete, it's easy to compare to historical trends, which is more important
in this context.

~~~
12xo
Interesting that you feel this data isn’t available on a per case basis...
it’s even more interesting that I end up with downvotes foe sharing my actual
experiences. HN is tone deaf. Most of you folks work in modern tech! Modern in
the sense that your company and job are likely based on big data... ugggh

~~~
skybrian
I think you got downvoted for dismissing the whole concept of random sampling.

In a random survey you're not representing your friends. They will presumably
be represented by randomly picking someone who happens to be more like them.
(Also unumployed.)

~~~
12xo
I didn’t dismiss anything of the sort, that’s what’s funny. I shared my actual
experience of being chosen as a panelist and have a vastly different outcome
and outlook than many of my friends.

It’s not an uncommon assertion that the Fed data is not accurate. Number 1
it’s political. And perhaps more importantly, it’s designed to obfuscate the
individual and that, while statistically accurate for static data is anything
but for this type of situation. People and specific employment issues are
anything but static...

~~~
IkmoIkmo
You literally said it's just a guess. It's not. It's a scientific method of
estimation which has known expectations of accuracy, and when done right, has
a track-record of being able to provide reasonable approximations. Saying it's
'just a guess' implies something very different for which you are rightly
downvoted.

Second, explaining the basics of random sampling by saying what applies to
you, did not happen to apply to your friends/family, implies you have no
understanding of the concept of random sampling either. There is absolutely no
requirement for your situation to be the same as your friends/family to make
this method useful, but by posting it as an argument, you imply that this does
matter. For this, your post is also rightly downvoted.

As for 'static data', it's a sample to provide insight in a snapshot in time.
It doesn't claim to be anything but static. It does exactly what it sets out
to do.

~~~
12xo
Garbage in, garbage out.... of course the data over time will correct but the
anomalies created by a few outliers are in fact a representation of bad
practices. And those outliers are not measured because one cannot ever account
for every potential situation when it comes to people. So they create a
margin.... works for figures but NOT for policy!! My point,by the way. No
wonder SV is still chasing ad optimization as it’s primary business. It’s
impossible to ever become efficient, but that doesn’t stop people from chasing
the paradigm. Because it’s the cracks and crevices that allow for
exploitation, that’s why.... oh never mind, I’m talking psychology to people
who think in binary and never the two shall twain

------
Pfhreak
With numbers like that, nearly everyone in the states knows someone impacted.
The optimist in me hopes to see people demand universal healthcare, social
housing, food benefits, and more so that everyone at least has a baseline
level of stability.

The pessimist in me believes that this number will be used to prematurely
force workers back to work, causing more illness and loss of work for those
who choose not to return.

~~~
vorpalhex
The issue isn't the demand. Everyone agrees across the isle that treating
every ill would generally be great. The issue is who will pay, how will care
be given equally, and how will the level of care be maintained or increase?

You can't just claim your car is now an airplane and drive off a cliff. Nor
will just attaching wings grant you the power of flight. You _can_ alter a car
into a functioning plane, but what do you have to sacrifice in order to make
that work?

~~~
Pfhreak
Raise my taxes by 10-15% (by increasing the tax rate at the upper brackets)
and put that money towards taking care of people who aren't employed. Yes, my
plans for buying a second home will be delayed, but I think I'd rather live
somewhere where everyone was taken care of.

~~~
commandlinefan
> Raise my taxes by 10-15%

People keep claiming that they're in favor of that. In fact, ~50% of the U.S.
population votes Democrat, so we should be able to extrapolate that ~50% of
the U.S. population supports an additional "feed the hungry" tax. However, if
they were truly being honest, they could easily donate 10-15% of their own
income to food banks/red cross/etc. which would actually be vastly more
effective in assuaging poverty than a tax increase, even if only Democrats
participated. The fact that I don't see that being done makes me question the
validity of those suggestions.

~~~
lotsofpulp
> However, if they were truly being honest, they could easily donate 10-15% of
> their own income to food banks/red cross/etc. which would actually be vastly
> more effective in assuaging poverty than a tax increase, even if only
> Democrats participated.

I don’t see why this has to be true. I’m also not going to sacrifice my
resources and be competitively disadvantaged because other people don’t want
to pay taxes. I’m going to continue trying to vote for a government that
reduces the wealth/income gap, but until the collective decides it and works
toward it, it behooves me and my kids to play the game individually.

------
bawana
And the stock market is unfazed. So now you know where most of that money
(trillions of relief for Covid) trickled to. The financial markets. We
basically printed money to assuage the fear and anxiety of the speculators to
whom the world is beholden

~~~
trcollinson
I keep hearing comments like this yet no real indication of what we should do
instead of having the market the way we do.

I have a lot of my personal wealth (which is not a substantial number compared
to a lot of investors) tied up in two areas. One of those is the stock market
(the other is real estate). Most of that is tied to index funds because the
returns are good. 401K's and retirement accounts is basically where it is. I
would imagine many of those who have any savings in the US are in the same
place.

So, a few things. First, as a small time investor that has a good chunk of my
future tied up in the US stock market, I certainly would not say that the
stock market has been unfazed over the last few months. It has been quite up
and down. I am glad it stabilized a bit so that this report didn't tank it.

Second, I am glad that the Fed did something to assuage the fears of the
market. Remember my future, and many millions of other peoples futures, are
tied up in that market.

Finally, let's stop making this out as if there are a few good ole boys
sitting in a back room moving the market around while they drink scotch and
smoke cigars and that they suddenly get nervous and start ruining everything.
The finance market has some really brilliant people working in it and trying
very hard to make money. What is the negative there? I think of it as a
symbiotic relationship.

So, if you disagree with the market and how we are all beholden to
speculators, what exactly do you suggest we do?

~~~
Ididntdothis
I think you are expressing the problem. The market doesn’t reflect economic
reality but instead there are a lot of people who need the markets to stay up
so their future is secure.

~~~
lotsofpulp
How is that not reality?

~~~
Ididntdothis
For most people reality is to have a secure job and income. The stock market
doesn’t reflect that reality. The fact that it’s going up helps only a
minority of the people.

~~~
kansface
Cities and States rely on the market for their pension funds. CA has ~$2
trillion in underfunded obligations ($83K per household)[1]. If the market
doesn't magically make up the difference, the state will in the form of new
taxes, budget cuts, and restructuring - or it can just go into a debt spiral
like Illinois and default in 30 years.

Universities rely on the market for their endowments ($500 billionish). When
the market goes down, tuition goes up.

~60 million Americans have a 401K worth about $6 trillion. Many of those
people are approaching retirement or have already retired.

> The fact that it’s going up helps only a minority of the people.

You may not be directly helped, but you will definitely feel the pain
(eventually) when it goes down.

1\.
[https://us.pensiontracker.org/stateSummary.php?idcode=06](https://us.pensiontracker.org/stateSummary.php?idcode=06)

~~~
lotsofpulp
>You may not be directly helped, but you will definitely feel the pain
(eventually) when it goes down.

Inflating assets by printing dollars greatly hurts the lower socioeconomic
classes by devaluing the only thing they have which is dollars.

------
aazaa
For comparison, the BLS reports an all-time high for unemployment (one-year
period) in the US was about 25%. It was 1933, deep into the Great Depression.

[https://data.bls.gov/timeseries/LFU21000100&series_id=LFU220...](https://data.bls.gov/timeseries/LFU21000100&series_id=LFU22000100&from_year=1929&to_year=1939&periods_option=specific_periods&periods=Annual+Data)

Markets really don't care about this number because it occurred in the past.
Everyone knew the number would be very, very bad and it was.

What markets care about now is what happens next. For their part, US stock
markets are saying everything will be Ok. The S&P 500 is trading 16% from its
all-time high.

Unexpectedly (for me at least), everything is riding on how well the Fed can
butcher the raging US dollar bull. It seems impossible, but there's a
substantial shortage of US dollars, which has been wreaking havoc on the world
economy for some time now, triggering negative yielding sovereign debt and
other imbalances.

If the Fed succeeds, the debts for this crisis will be eliminated through a
weaker dollar (dollar holders will pay in purchasing power), and things can go
on more or less as normal.

If, however, the Fed is unable to bring the dollar down and hold it there for
a long time, the ballooning debt will begin to choke the real economy. We'll
see it first in interest payments to finance the federal government rising and
eventually forcing cuts to entitlements and defense spending.

This would appear to set up a situation in which the Fed will try to err on
the side of "caution" \- adding too much rather than too little liquidity into
the economy.

It's worth remembering that the Fed always gets what it wants in the end.

See:

[https://www.lynalden.com/global-dollar-short-
squeeze/](https://www.lynalden.com/global-dollar-short-squeeze/)

------
vikramkr
To preempt the apparently inevitable "wow stocks went up on this news why wall
street be like that" posts : the reason futures are up currently and the
market will be up when they open in a but is because this is better than
expected. Wall street was expecting unemployment to rise to over 16% [0].
Therefore, the markets were pricing in an expected 16% unemployment rate.

The real number today is lower, meaning the markets are going to adjust up to
meet the difference. That's why it might look like the markets are cheered by
the unemployment news. They kind of are, it's better than they expected.

Edit: Updated the link to a non AMP link.

[0][https://www.wsj.com/articles/april-jobs-report-likely-to-
sho...](https://www.wsj.com/articles/april-jobs-report-likely-to-show-highest-
unemployment-rate-on-record-11588514401)

~~~
ctvo
The narrative the market has taken into account ("priced in") the current
economic factors is tiresome. If it did, we wouldn't up at the numbers we are.

The more likely scenario is the market is disconnected with economic
conditions, and the low volume seen in this rally are the same set of market
participants creating liquidity while the majority watch from the sideline
awaiting more news.

~~~
Spooky23
A lot of businessy people buy into some sort of magical wisdom of the market.

It’s not a particularly wise institution, and pouring money in now is just
institutional players enabled by free money coming out of government. The rest
are lambs heading for slaughter, as there are very significant headwinds in
our future that the market has not priced in.

~~~
robjan
If you're so sure of that, I hope you are shorting the market.

~~~
ceejayoz
I'm not prepared to take the unlimited downside on that, but I did largely get
out of the market recently. The Dow hit the 7000s in the last recession, and
every indication is that this one will be far larger.

~~~
frockington1
Theres many ways to do that without unlimited downside. Buy long dated puts.
If you really think the DOW will hit 7000, then buy gold because everything
will crumble. What bad news do you expect to cause the market to decrease by
70%? States are opening up with success and even South Dakota who did
absolutely nothing seems to be doing pretty well

~~~
ceejayoz
> What bad news do you expect to cause the market to decrease by 70%?

The recession we've just entered?

> States are opening up with success

Sure, and the Iraq War was winding down back in 2003.

[https://en.wikipedia.org/wiki/Mission_Accomplished_speech](https://en.wikipedia.org/wiki/Mission_Accomplished_speech)

------
dayofthedaleks
The U6 number from the report is 22.8%. U6 being folks who are out of a job
but not properly on the dole.

I would expect that number to be north of 25% in the upcoming May report.

~~~
zeusly
Definition of on the dole: Unemployed and in receipt of state benefit.

Origin of on the dole: In the UK, Unemployment Benefit has been known by the
slang term 'the dole' since WWI. This derives from the 'doling out', that is,
'handing out' of charitable gifts of food or money.

~~~
hackissimo123
Wow, I'm British and I never made that connection before between "the dole"
and the verb "to dole out". TIL.

------
Shivetya
Unemployment numbers are not the only issue at hand, from reduced hours to
outright cuts in salary; we just took ten percent for two months and it can
get to be more, an I have seen others reporting greater than ten percent for
regular salaried employees.

Unemployment is horrible but don't discount salary cuts either, for some
single earner families to include those only recently forced into single
earner it can be very stress inducing

~~~
myth_drannon
Tesla had 20% salary reduction.

------
ryanwaggoner
And yet market futures are green, just like they always are after horrible
news.

How high does unemployment have to get before investor sentiment shifts and
the market tanks? 20%? 50%?

Was the market severely undervalued a few months ago, when we were previously
at these levels? It’s hard to see how this pandemic is anything other than a
huge drag on the economy over the next few years, _at least_.

~~~
Axsuul
Markets think into the future, not the present

~~~
aguyfromnb
> _Markets think into the future, not the present_

How far into the future, then? Over a long enough time span everything goes to
zero. Are there no future consequences to record levels of unemployment?
Everyone just goes back to work in the fall like nothing happened?

~~~
Axsuul
It’s anyone’s guess but the market being green means investors are optimistic
about the future. Everyone going back to work is not an unrealistic scenario
since there are countries in Asia that are already doing this.

Also keep in mind unemployment rates are expected during a pandemic. They are
apples to oranges when comparing them to high employment rates during times of
normalcy.

Finally I think it’s very easy for humans to overestimate current situations
and underestimate just how easy it is for society to forget what it was like
half a year ago.

~~~
aguyfromnb
> _Everyone going back to work is not an unrealistic scenario since there are
> countries in Asia that are already doing this._

You're not following the economic story very closely if you think any of those
countries are "back to normal".

> _Also keep in mind unemployment rates are expected during a pandemic._

Do you have a source to anything at all about how any of this was "expected"?

~~~
Axsuul
I never said those countries are "back to normal", you're misquoting me. I
meant to say they are going back to work. Further compound that by countries
like Sweden that are business as usual

You don't need a source. You already know it will lead to higher unemployment
since pandemic -> everyone staying home -> businesses halted -> people losing
their jobs (although the market has judged this as ephemeral)

~~~
aguyfromnb
> _you 're misquoting me. I meant to say they are going back to work._

Oh, so when I asked if people were "going to go back to work like nothing
happened", and you replied "Ackchyually, Asian countries are going back to
work" you deliberately left out the "like nothing happened" part, and are now
agreeing that it's not "back to normal"? Got it.

> _Further compound that by countries like Sweden that are business as usual_

Not true.

> _You already know it will lead to higher unemployment since pandemic - >
> everyone staying home ->_

In what other pandemics did everyone stay home and unemployment went way up?

~~~
Axsuul
I have no idea what kind of straw man argument you're trying to make anymore
other than I think you're looking to pick a fight by being pedantic about
words. So I'll just leave it at that.

------
lquist
What is the unemployment rate for software engineers? Can't seem to find this
in the BLS data

~~~
SloopJon
"Information" is probably the most representative category, which shows an
unemployment rate of 11% in table A-14, compared to 3.5% a year ago.

------
knolax
IIRC anyone looking at the unemployment rate has to look at some factors that
could inflate or deflate the rate. The unemployment rate is a proportion of
those _seeking employment_ that do not have a job. This means that as time
goes on, people who would like to have a job stop seeking and therefore stop
contributing to the unemployment rate (eg. someone going homeless actually
makes the unemployment rate go down). On the converse side, seasonal workers
and those in between jobs also inflate unemployment numbers to a small extent.
In addition, the employment rate does not measure underemployment, which is
important as the gig economy becomes more and more common (although perhaps
not as much during quarantine).

------
bwb
Am I the only one who looked at all the graphs and thought, man this is going
to make it really hard to make good graphs during the next recession :)?

------
lihaciudaniel
This is just like the great depression a hundred years ago

------
yumraj
And Dow Jones is up by almost 400 points. Go figure..

~~~
TAForObvReasons
High unemployment means higher likelihood of Fed support. Equities markets
have largely decoupled from the state of the economy.

------
treyfitty
I posted the official numbers and report from the BLS
([https://news.ycombinator.com/item?id=23114063](https://news.ycombinator.com/item?id=23114063))
but it never caught traction. Same goes for other times I post from the proper
source. However, it seems like HN has a bias for WSJ and NYT articles. In my
opinion, the BLS report is more enlightening and breaks down sectors.

Is there a reason why official government reports never catch traction?

~~~
jasode
_> I posted the official numbers and report from the BLS but it never caught
traction. Same goes for other times I post from the proper source. However, it
seems like HN has a bias for WSJ and NYT articles. [...] Is there a reason why
official government reports never catch traction?_

Just a theory but _titles_ of threads do matter. I'm not claiming it's the
reason in your case but it might be.

\- Your previous title with no activity: "BLS Reports 14.7% Unemployment Rate"

\- This title that attracted upvotes: "April Unemployment Rate _Rose to a
Record_ 14.7%"

Your title's matter-of-fact tone is clinical and missing the _impact_ of the
14.7%? Hmmm... the 14.7%... so... is that a lot or a little?

The phrase _" rose to a record"_ is immediate spoonfeeding of _the impact_ to
potential readers.

Good newspapers like WSJ, NYT, Buzzfeed, etc know how to craft titles to get
readers to click on them. This is often abused and thus disparaged as
SEO/clickbait. In this case, providing a _little bit of a statistic 's impact_
could be helpful.

~~~
malshe
Conincidentally I came across a relevant Twitter thread about creating
headlines. NYT does A/B testing in the morning to determine which headline
they should keep for the rest of the day.
[https://threader.app/thread/1258492772442681346](https://threader.app/thread/1258492772442681346)

The last tweet reads:

For what it’s worth, nytimes senior editor mark bulik said, “we’ve learned a
number of lessons from months of testing... clear, powerful words and a
conversational tone make a big difference.”

~~~
supernova87a
Unfortunately, I can also see that this tactic is a tool for causing clickbait
and stories to be written a certain way, because editors get tuned to what
causes people to click the most.

"Guess what government figure just hit 14.7% today?"

"These 3 sectors hate the latest unemployment figures!"

~~~
hnarn
Only if you allow click-bait to be a part of the A/B testing in the first
place, which is where a sense of serious journalism comes into it.

------
MrBuddyCasino
The french economy has been hit harder than many other countries, probably due
very generous short-time working relief measures, where the state pays 90% of
the former salary:

"Could there be a connection between the deep recession - in no other eurozone
country did economic output in the corona crisis collapse as sharply as in
France - and the generous short-time working arrangements?"

[https://translate.google.de/translate?sl=auto&tl=en&u=https%...](https://translate.google.de/translate?sl=auto&tl=en&u=https%3A%2F%2Fwww.tagesschau.de%2Fausland%2Ffrankreich-
gehaelter-coronavirus-101.html)

Tl;Dr: France once again becomes socialist, discovers that incentives are
powerful.

~~~
jeltz
So France became socialist because they did the most generous handouts to
companies?

~~~
MrBuddyCasino
Yes.

