After revealing an unprecedented spike in unemployment claims, he said, “You’ll see these numbers translating into unemployment rates that will be rather jaw-dropping.”
Newsom then predicted these rates will be seen not only in California, but across the country.
The state’s revised budget comes out on May 14, so specific unemployment numbers will be released then.
Newsom called the rise in unemployment claims “Without precedent in our state’s history,” noting that 4.2 million people have now applied for Public Unemployment Assistance and $10.6 billion in aid has already been distributed.
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The spike in claims, Newsom said, has resulted in a massive $2 billion being distributed since Sunday.
“You’ll see these numbers reflected in budgets” both state and local, said the governor, before adding that, at the state and local levels “revenues are just falling off a cliff.” Newsom said those drops have happened “in just weeks, not months.”
Any recovery, said the governor, “will take a lot longer than people are saying.”
“We’ve never experienced anything like this in our lifetime,” he went on grimly. “This is Depression-era numbers in terms of the unemployment across the country — not just in the state.”
“Just do the math on the number of Californians who have filed for unemployment just since March 12,” urged the governor. “We had record low unemployment in January, record surplus, and you’re gonna see a budget [on May 14] that comes out tens of billions of dollars short of where it needs to be.”
How bad has it been nationally? According to the New York Times on Wednesday, U.S. have been reported to have plummeted by 20 million jobs in April 2020. Government numbers coming Friday,” reports the paper, will reveal the losses were even worse than that. According to NYT, those figures “will undoubtedly show that job losses in April were the worst ever.”
“We are accountable to balance our budget,” Newsom said, noting the state cannot just print money. “We can’t do this without the Federal Government.”
“We really need leadership at the federal level,” said the Governor, “to provide the magnitude of support” that will match the crisis.”
Newsom predicted that the road to recovery is long and will be measured in years, not months.
“I’m not of this opinion,” said the governor, “that this [drop in economic activity] is a quick V and we’re going to come back in a few months.The next few years, we’re going to have to work through these challenges.”
In closing, said Newsom, “We have our work cut out for us.”