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The beginning of US layoffs tied to the coronavirus showed up earlier than expected, but the drop in March is still far from an accurate picture of labour markets today, according to Nathan Janzen, a Senior Economist at the Royal Bank of Canada.

Key quotes

“The 701K employment decline in March was already the largest since the financial crisis. The unemployment rate spiked by almost a full percentage point to 4.4% and broader measures of labour market under-utilization jumped more than that.”

“The April jobs decline will almost certainly be the biggest in recorded history, and measured in the millions rather than thousands. The April unemployment rate could well jump to 15% or more.”

“The reality is that activity is not going to bounce-back overnight, and some businesses will be forced to permanently shut their doors. The longer the current disruptions last, the longer the recovery on the back-end is likely to take.”