NOEL KING, HOST:
The news from the Labor Department this morning is staggering - 20.5 million jobs, that's how much the U.S. lost last month. The unemployment rate is now at 14.7%. By way of comparison, in February, the unemployment rate in this country was about 3.5%. This is the worst it's been since 1940. What does this mean as we move forward, and can we learn anything from the past? With me now to help answer that, Heidi Shierholz, who's an economist at the Economic Policy Institute, and Claudia Goldin, who's an economic historian and a professor of economics at Harvard. Good morning to you both.
HEIDI SHIERHOLZ: Good morning.
CLAUDIA GOLDIN: Good morning.
KING: Heidi, let me start with you. We're looking at job losses of, as I said, more than 20 million, with unemployment pushing toward 15%. Which of those numbers is more helpful to understanding how we are doing?
SHIERHOLZ: They're both useful, but the 20 million is more - it gives more of a picture of really what's going on because the unemployment rate right now is actually understating. Even how big it is, it's actually understating how bad things are because there's a lot of people who have lost their job as a result of the coronavirus, but are not actively seeking work right now because of the lockdown. And in order to be counted as unemployed, you have to be actively seeking work. If you counted those people in and some other folks who are likely misclassified as being employed, but absent from work when they should be classified as temporarily unemployed, the unemployment rate right now would look more like 24% rather than 14.7%. So it's - so we are really in just unprecedented territory right now.
KING: Given that you've just said this is unprecedented, I wonder, as you dug into the report, was there anything in there that surprised you, either positive or negative?
SHIERHOLZ: I'll go with some positive news because this has been a very grim morning. But one of the things that was a bit of good news is that 78.3% of unemployed workers report that they are on temporary layoff. And that's a very historically high number. And that is good news. So to the extent that people are still connected to their jobs, think that they're going to be called back, that means that when the virus is controlled and the economy can start successfully opening again, the recovery will be quicker because you can just get things going again when people are still connected to their job. So that's one real sliver of hope here.
KING: OK, I like to hear it. Claudia, let me turn over to you. You're a historian. We're hearing references this morning to the Great Depression being thrown about. Is that a fair comparison?
GOLDIN: In some ways it is, in terms of the numbers it is. But when the Great Depression hit America, no one had any idea what was happening. The stock market crashed, credit markets were in shambles, banks would begin to fail. There were bread lines. People were clearly unemployed, and yet there was no way to measure it. There was no definition of the labor force. There were no data. We're in much better shape now because we actually know what's happening.
KING: The thing that is happening, of course, is a pandemic. And I wonder, this country has been through a terrible pandemic before, in 1918, the influenza pandemic. What happened to the economy then, and is there anything we can learn about how we came back then that would apply to today?
GOLDIN: Very, very good question. Everything that I have looked at shows that the economic statistics that we have - and remember we really didn't have real economic statistics...
KING: Sure.
GOLDIN: ...We've sort of rebuilt them. We can't really see a lot of economic decline. And part of it was we were fighting a war. So, in fact, a lot of the headlines were labor shortage. We also know that various cities closed down and various cities didn't. At the end of the day, they both had the same aggregate numbers of deaths, one of them had it over a longer period of time. So we learn a little bit, but we really don't learn a tremendous amount about what happened to the economy because that economy, if we look at it from our vantage point now, it doesn't look like it imploded the way this economy is imploding right now.
KING: All right. It was 102 years ago, so things were just different. I do wonder, though, if we look at 1918, then look at the Great Depression, is there one policy that you could point to and say, that one was a good one, we should be doing that if we're not already?
GOLDIN: What we did during the Great Depression was we put in place something called unemployment insurance. And that is in many ways a very, very good thing. We put it in place in 1935 in the omnibus Social Security bill. It didn't pay out until 1938, '39, until that horrible Great Depression was almost over. We have it now. And that is a very, very important thing. It could get people over this terrible, terrible situation.
KING: Nice to hear we have the policy we need. All right. Heidi, let me turn back to you. You mentioned that many people - 78 or so percent - are optimistic that their jobs are coming back. Many of us are hoping, praying that that will happen. Can you talk about the likelihood of that happening and what kinds of jobs will come back?
SHIERHOLZ: That's a really good question, and it's kind of an unknown right now. I do have concern that, you know, these are self-reports, people saying, I'm unemployed, but I expect to be called back. And so we don't know how many of those will actually translate into people being called back. And I do think that now we're seeing more businesses going bankrupt. They may have told people we're furloughing you. We're going to call you back, absolutely in good faith, but then because this was worse than they expected end up going bankrupt.
We don't know exactly, you know, what share will that translate into. But it does - I am concerned about that and we just - policymakers just need to step in, do a lot more to support this economy and make sure that we can keep as many businesses viable, as many people connected to their old jobs as possible so that when the economy can reopen it can do it as smoothly as possible.
KING: Heidi Shierholz of the Economic Policy Institute and Claudia Goldin of Harvard. Thank you. Transcript provided by NPR, Copyright NPR.