MAY 13, 2020
- Powell said that around 40% of Americans earning less than $40,000 a year lost a job in March, citing a Fed study set to be published on Thursday.
- “This reversal of economic fortune has caused a level of pain that is hard to capture in words, as lives are upended amid great uncertainty about the future,” he said during a webinar.
- Powell also called for further economic relief to shore up a battered economy ravaged by the pandemic.
Fed Chair Jerome Powell said on Tuesday that a substantial portion of lower-income Americans had been laid off in March.
“A Fed survey being released tomorrow reflects findings similar to many others: Among people who were working in February, almost 40% of those in households making less than $40,000 a year had lost a job in March,” Powell said in a webinar at the Peterson Institute for International Economics.
“This reversal of economic fortune has caused a level of pain that is hard to capture in words, as lives are upended amid great uncertainty about the future,” he said.
The alarming statistic set to be published in Thursday’s Fed study underscores the severe pain felt among low-income workers and their families during the pandemic. Many of those jobs are concentrated in the service sector, which are less likely to have benefits like paid sick leave or the ability for employees to work from home.
A survey from the Pew Research Center released in April also found that one in four lower-income adults had any savings to cushion financial shocks caused by job losses or other emergencies.
Powell recognized the scale of the economic damage wrought by the virus. He also called for additional relief measures to further shore up a battered economy.
“Additional fiscal support could be costly, but worth it if it helps avoid long-term economic damage and leaves us with a stronger recovery,” he said.
Over 33 million Americans have filed for unemployment in the past two months, as scores of businesses shuttered and people stayed home to curb the spread of the virus.
Democrats recently unveiled a $3 trillion spending proposal aiming to extend additional lifelines to states, businesses, and people weathering the pandemic. But Republicans declared it dead-on-arrival in the Senate.
Courtesy/Source: Business Insider