Houston-area unemployment rate rises to nearly 15%, says UH economist
As the effects of the pandemic continue, the Houston area’s economy is impacted through increased rates of unemployment during this time.
As estimated by Bauer economist Bill Gilmer, the unemployment rate is nearing 15 percent currently, and that comes from the loss of jobs brought on by COVID-19.
“This is about the virus,” Gilmer said. “The U.S. economy was growing at a healthy and moderate rate until the virus struck.”
Compared to Houston’s past unemployment rates, Gilmer noted the increase from the 12.5 percent in April is higher than anything seen in modern times, including the rates after the Great Recession and Tech Bust in 1991.
The economics of past pandemics have played out widespread illness as there were labor shortages when workers took time off because of an illness, Gilmer said.
“This time we add the new wrinkle with stay-home orders and widespread, enforced public distancing,” Gilmer said.
Since the enacted stay-at-home orders in March, the Houston metro area resulted in nearly 400,000 lost jobs causing the spike in the unemployment rate, Gilmer said.
This impacts students graduating from UH and attempting to enter the job market.
“These (impacts) affect everybody,” Gilmer said. “It is small consolation, but these external shocks to the economy are a feature of the business cycle that has been seen by previous generations of students.”
With Gilmer’s predictions of the economy, Houston seems more likely to come out with a normal business cycle once businesses start back up again and workplaces are reopened.
Gilmer told KHOU he expects jobs to come back when the Houston metro reopens for business.
The lifting of public health orders will increase the metro ridership, Gilmer said.
With a successful return to work, the fiscal and monetary policies implemented should provide a bridge from current chaos back to economic fundamentals, Gilmer added.
“Until public health officials are willing to characterize the virus and tell us about how widespread it is and how long it might last,” Gilmer said. “The economist is guessing as well.”
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