CNBC: A Second Great Depression? Unemployment Crisis Hits Big Cities Hard

Article by Greg Iacurci in CNBC financial

Great Depression levels of unemployment have hit some of the country’s biggest cities.The coronavirus pandemic has pushed the jobless rate in New York, Los Angeles and other major urban areas to near or above 20%, nearly twice the national rate.

The unemployment rate is a barometer of financial hardship for American families, since losing a job typically leads to a significant drop in household income.

A rate of 20% means 1 in 5 Americans in the labor force can’t find work.

That’s double the national peak during the financial crisis of 2008-2009 and a level unseen since the 1930s, when the country was in the throes of its worst-ever economic downturn in the industrial era.

“It’s devastating, in terms of how high that unemployment rate is,” said Ioana Marinescu, an assistant professor of economics at the University of Pennsylvania.

The dynamic is pronounced in New York, the nation’s largest city and a major tourism and entertainment hub that supports thousands of jobs in a service economy that’s been ravaged by the coronavirus pandemic.

New York’s unemployment rate rose to 20.4% last month, according to state-level data issued Friday by the Bureau of Labor Statistics that detailed figures for some large metro areas. That’s up from 18.3% in May and 15% in April.

The ranks of unemployed New Yorkers have grown by 261,000 people since April, to more than 811,000, according to the Bureau.

Los Angeles, the second-largest U.S. city, has seen a similar level of joblessness.

Its unemployment rate recovered slightly in June but remains startlingly high — at 19.5%, versus 20.6% in May, according to data published Friday by California’s Employment Development Department.

That reduction is in jeopardy due to rising coronavirus cases in ...

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