Unemployment will be a major issue amid Covid-19 pandemic, according to leading macroeconomic influencers

GlobalData Thematic Research 11 May 2020 (Last Updated May 11th, 2020 11:39)

Unemployment will be a major issue amid Covid-19 pandemic, according to leading macroeconomic influencers

The Covid-19 pandemic may lead to unknown economic challenges as countries across the world face rising unemployment rates and inflation. Governments are trying to minimise the impact of the pandemic through economic relief packages but it may lead to huge debts.

Anders Åslund

Anders Åslund, an economist and author, tweeted about the unknown consequences of the Covid-19 outbreak. He noted that the pandemic may lead to deflation or inflation or both in different parts of the world over different periods of time.

Åslund made this commentary while sharing a tweet on Germany’s €1 store increasing prices by 10%. He noted that macroeconomic stability will be challenging during the current pandemic.

Jonathan Portes

Jonathan Portes, professor of economics at King’s College London, tweeted about the basic things that need to be done to address the unemployment issue in the UK. He noted that people’s income should be supported, viable jobs should be made available for workers after the crisis and help should be provided to workers to find new type of jobs if their old jobs are no longer viable

Portes added that assistance should be provided to young people who are entering the labour market amid the economic downturn.

Linda Yueh

Linda Yueh, an economist and author, shared an article on the measures being considered by the US government to address the unemployment rate in the country. The government is considering another round of stimulus to provide aid to workers who are facing unemployment and cannot meet basic needs.

The article adds that the unemployment rate predicted by the government is more that 20% in May and June.

Claudia Sahm

Claudia Sahm, a macroeconomist, tweeted that the direct cost of unemployment benefits offered to workers in the US will be $800bn in 2020 and $2tn over next ten years.

Sahm noted that considering that the US is a $20tn economy a year, workers will need to be provided far more benefits in order for them to survive the economic downturn caused by the COVID-19 pandemic.

Joe Sarling

Joe Sarling, an economist, tweeted the top economic events expected to occur over the next week including trade wars, GDP woes and labour market concerns.

Sarling also tweeted statistics related to the UK economy, which is predicted to contract by 14% in 2020 and unemployment rate is expected to reach 8%. He added that the German economy will shrink by 6.3%, which is biggest contraction since World War II.