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The extreme events we have witnessed over the past twelve months have pushed America to an economic depression that opened very deep economic scars in several groups all across the nation. However, the promise of a successful reopening and a rapid economic rebound seems to be disguising just how deep such scars actually go. Even though our leaders insist everything will be fine, evidences point to a very different outlook. The reopening doesn’t mean that things will come back to where they were before the health crisis and government-mandated shutdowns ravaged our economy. In fact, we’re about to see a completely changed environment, as over 4 million businesses were completely wiped out throughout the downturn, and workers have been facing increased challenges to get back to the labor market. Recently graduated and first-time workers will have to deal with an even gloomier reality – they will become part of a generation of unemployed who will inevitably fall behind in making important life decisions, such as starting a career, leaving their parents home, and building their own wealth. The future doesn’t look as promising as it once did for most Americans. And a loopsided reopening is about to increase economic vulnerabilities, widen the inequality gap and compromise the growth of entire generations, putting us in a dark age of continuous recessions and steep financial setbacks. That’s what we’re going to in this video.
The past year has been incredibly distressful for the United States. Never in history we have seen so many businesses disappearing in such a short span. From the bust of the crisis up until now, we have lost 4 million businesses. As a result, we have watched a tsunami of unemployment crash our economy, with more than 70 million claims for unemployment benefits being filed during the early months of the collapse. To this day, the number of weekly claims continues at alarming levels that are about three times as high as those registered during the Great Depression of the 1930s. Although the reopening of the economy is scheduled to occur all across the country until June, that doesn’t mean a real recovery will actually follow, especially considering some groups will be completely left out of the rebound. The Economic Policy Institute recently informed that approximately “25 million American workers are either unemployed, underemployed or have pulled out of the workforce entirely”.
The current economic depression has pushed millions of formerly middle-class workers straight into poverty, and for many of them, life will never be the same. All groups that were already struggling with financial strains before the downturn were hit particularly hard when the jobs vanished. In the short-term, federal stimulus money provided a safety net for many households and small businesses, but now, even with extended benefits, several families don’t qualify to collect them anymore. Some ascribe the exponentially higher unemployment rates among city residents and low-and-middle-income residents to the collapse of the retail and hospitality industry. Those jobs were once fueled by customers who are now working from their suburban homes, and given the staggering number of permanent store closures and business bankruptcy filings, they might never come back. According to the Bureau of Labor Statistics, a whopping 2.4 million Americans have been unemployed for 52 weeks or longer, which represents 24% of all unemployed.
We’re now at a dangerous period for households from a financial perspective. For first-time workers and college graduates, this period will also be particularly distressing. The job opportunities that they were promised will not be materialized in the foreseeable future. The unemployment rate for those aged 16-24 is even higher than the national rate, at 11.1% in March. Pew Research Center analysis has disclosed that the share of 18-to-29-year-olds living with a parent has hit its highest level since the Great Depression. By the end of 2020, the share of young adults living at home stood at 52%.
Failing to land that dream first job, whether in high school or college, can end up derailing a lifetime’s worth of career experience, economist Gould says. The next generation will, unfortunately, stay unemployed for much longer than anyone could have imagined, and that will compromise the growth and the future of this group, because it will take much longer for them to pay off student loans, to start a family, to invest and buy a house. But even in face of all that, our leaders insist that “we’re headed to an economic recovery”. In reality, it seems that we’re approaching even more troubled times, and our long economic nightmare is just beginning.