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Bankrate's Mark Hamrick on the shape of the economic recovery

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Mark Hamrick, Bankrate.com Senior Economic Analyst, joined The Final Round to discuss the latest jobless claims numbers, what it means for the economic recovery, and his outlook for the jobs market headed into next year.

Video Transcript

JEN ROGERS: Welcome back to "The Final Round." We've got just about 30 minutes left in this trading session with stocks higher here, but off of their highs. One of the pieces of news today has been on the labor front and what we're seeing with claims here, our weekly ones.

And I want to bring in Mark Hamrick, bankrate.com senior economic analyst to help us a little bit more on the labor picture. Because it is continuing to be confirmed that we have seen our momentum slow and this idea of the V-shaped recovery, especially in labor. How bad is it right now?

MARK HAMRICK: Well, I go back to the quotation often I recall that went back to President Reagan, right? He talked about it's a recession if it's your neighbor who is unemployed. And it's a depression if it is oneself, to paraphrase. And I think in terms of taking a look at the broader picture, I think we can all agree that it's pretty darn bad.

And with roughly 8% unemployment that we got in the most recent jobs report for the month of September, leaving aside sort of dithering around the edges of how that measurement might have looked otherwise by virtue of the statistics, meaning, you know, there are always problems with the stats, we're really still in the midst of a downturn that's on par with what we had seen during the downturn of a little more than a decade ago in the sense of where that--

JEN ROGERS: Did I freeze, or did he freeze? I think he froze. I freeze a lot. I'm going to wait for a second, see if Mark Hamrick comes back. If he doesn't, I'm just going to make sure that I'm not frozen.

Seana Smith, I know you were listening to him and thinking about a question that you wanted to ask him. When you listen to him talk about the idea of this depression, of course, that is that when it's you, it's a big deal. And we have seen so far what's happened, is that a lot of jobs that were lower paying were lost early on. And that's why we had average hourly wages go up.

But now the jobs that we are hearing about are not in that category. If you look at the airlines, or as I said, "The Wall Street Journal" reporting that AT&T is looking to cut costs by 20% at Warner Media, Disney laying off tens of thousands. So it does seem like it's taken a little bit of a turn recently.

SEANA SMITH: Yeah, it certainly has, and I think that that's a big question going forward here, just in terms of what we've seen play out over the last 7 to 10 days. We've seen a lot of these white collar jobs that you were just describing start to go away and really start to be eliminated here because of this downturn that we are in. So of course, the question is, whether or not this is indicative of something else here going forward.

And I also think just from the large picture here, when you take a look at what's still taking place, there are still over 25 million people-- I think it's 25 and 1/2 million workers collecting some sort of benefits at this point. So of course, this is something to keep in mind, going forward. And I believe we have Mark back here. Mark, are you back with us?

MARK HAMRICK: Yes indeed. The internet was editing me there, I think.

SEANA SMITH: No problem. It's happened to all of us multiple times here over the last several months. So Mark, I just want bring you back into the conversation, just get your thoughts just on-- you were just talking about where we stand in this recovery at this point.

But of course, the question is, the best case scenario, I think, at this point, is that we will get some sort of vaccine in the first part of next year. So if we go off of that, I guess, how long do you think it will be until we get back to full employment?

MARK HAMRICK: Sure. Well, full employment, I don't think that that's something we have any visibility about right now. You know, whether you're hearing what Chairman Powell, the Federal Reserve, talks about. And then the question is, what is full employment then? You know, because when we were at 3 and 1/2% unemployment earlier this year in February and, I believe, first in September of last year, that was a lower level than people thought we could get to.

I can remember, you know, a while back, maybe two or three years ago, when I said that 3 and 1/2% seemed doable, and that was, obviously, a hunch. And that seemed almost radical at that point. And sure enough, we got there. And yet, there were corners of the job market that were still not participating as much the job market, as so would be the case.

But, you know, we just completed one of our BankRate economic surveys. And the participants there saw unemployment remaining at-- when you take all these responses together, at 7% a year from now. And so that tells you that we will still have quite a journey going forward.

And as you say, one of the most important developments will be the availability first of a safe and effective vaccine, likely to be followed by others. And exactly what that part of the journey looks like, you know, we can only guess, but it's going to be very, very important, along with any other treatments, that could make COVID less of a would-be death sentence.

JEN ROGERS: All right, Mark Hamrick, bankrate.com senior economic analyst, great to get a chance to talk with you.

MARK HAMRICK: Thanks so much.