¶ The Unemployment Cost of COVID-19: How High and How Long?

Link to Article

¶ BibTeX

@article{sahin2020unemployment,
  title={The unemployment cost of COVID-19: How high and how long?},
  author=ahin, Ay{\c{s}}eg{\"u}l and Tasci, Murat and Yan, Jin},
  journal={Economic commentary},
  number={2020-09},
  year={2020},
  publisher={Federal Reserve Bank of Cleveland}
}

¶ Summary / Abstract

We use flows into and out of unemployment to estimate the unemployment rate over the next year. This approach produces less stark projections for the unemployment rate over the course of the next year than some of the more alarming projections that have been reported. Using our approach and assuming that the severest social-distancing measures will be lifted in June, we estimate that the unemployment rate will peak in May at about 16 percent but gradually decline thereafter and end the year at 7.5 percent.

Figure 2 shows the unemployment outflow and inflow rates, F and S, from 1948 to 2019 as computed using the approach developed by Shimer (2012).