A record number of people may become unemployed if lawmakers don’t do something, Treasury Secretary Steven Mnuchin said on Tuesday.
On Wednesday, President Trump announced the federal government would suspend all foreclosures and evictions through the end of April in an effort to support Americans who are struggling financially due to the coronavirus outbreak.
“The Department of Housing and Urban Development is providing immediate relief to renters and homeowners by suspending all foreclosures and evictions until the end of April,” Trump said at a White House press briefing. “So we’re working very closely with [HUD Secretary] Dr. Ben Carson and everybody from HUD.”
A steadily growing number of Americans are concerned about how they’ll make their next rent or mortgage payment as they face pay cuts, layoffs, and fewer hours due to the pandemic. One prediction this week estimated that as many as 10 million workers could see their paychecks affected.
Without government intervention, Treasury Secretary Steven Mnuchin warned Republican lawmakers Tuesday, the U.S. could face a devastating leap to 20% unemployment.
Mnuchin said that the impending crisis could double the highest unemployment rate of the 2007-09 recession, which was 10%. The U.S. Federal Reserve has already pushed to strengthen the economy by slashing interest rates and announcing emergency lending programs. The White House’s $1 trillion stimulus package, which provides financial assistance to hourly workers and smaller businesses, was touted as the next step in the closed-door meeting.
Mnuchin’s forecast is notably more dire than that of banking economists. Wells Fargo released a report predicting unemployment would reach only 5.3% by year’s end—still a dramatic upturn from February, when the nation’s jobless rate pre-COVID-19 was a low 3.5%.