Short News Analysis on the Current State of the Economy

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An article by BBC News (2020) outlines the economic models' changes within this year, highlighting the changes in revenues and other financial parameters. It indicates how income from small businesses went up to 20 percent and below since January 2020. Bankruptcies increased drastically compared to the other years. The new business formation has dropped, and there are increased job layoffs. Labor force not at work rose from January to April 2020. Those searching for jobs and those not in the labor force increased by 405 million in April and continued to grow. In April 2020, the personal savings of the United States citizens reached the highest recorded level. Low-income families with children experienced income shock. Rent and mortgage payments became difficult to the extent that only one out of five households could afford a descent payment plan (Blecker p.203). In the second quarter this year, June, May, and April, a 30 percent contraction of the economy, which is more than10 percent, three times fall compared to 1958. These concepts align with the different economic aspects discussed in the class theories, as outlined below.
Early this year registered the lowest unemployment rate of 3.5 percent, which was recorded as the weakest in more than 50 years. Before the outbreak of the coronavirus, there were 6.4 million jobs. The lockdown led to an increased unemployment level, which rose to 14.7 percent and marked the highest level since the great depression of 1930. Economically, the operations of businesses were dormant during the period. Most of the items produced were shifted to other sections of the society like food and health products. According to the United States Labor Department, 20 million people lost their jobs (Abraham et al., .p. 585). During the peak of April, the rate of unemployment dropped to 7.9 percent in September. Real wage grew up to 2.1 percent per annum in 2019 February before the coronavirus effect struck, which has now continued to decrease.