U.S. Falling Behind Italy Recovery

For weeks, I’ve expected the U.S. to largely follow the path of Italy – and so far it has. Unfortunately, the last few days, U.S. cases have not been declining as fast as Italy.

Italy (+ 14 days) vs. US Covid-19 Cases

As seen in the graph, the cases matched well until about April 11th when the US has started staying much higher than Italy.

If we calculate a 5 day average of cases to remove testing variability, we can see the US is now close to 80% of peak cases while Italy was only 60% at this time.

It seems rather – and probably naturally – that we are now closer on the EU path. Like the EU, we have different ‘countries’ (i.e. states) with different restrictions. This is expanding our plateau period

EU (+9 Days) vs. US Covid-19 Cases

Note, however, that both Italy and the EU graphs suggest about 60% of peak cases in the US on May 1st. Thus, it is possible we end up converging still.

A good reason for the increase in cases yesterday is better testing – so that is a good thing.

US Unemployment Close to 20%

We had another 4.4mm jobless claims here in the U.S. this morning. That puts the aggregate total at close to 26.5mm in just 5 weeks.

Cumulative job losses since start of recession

Given we had about 160mm people employed in the U.S. in March, that implies an increase of unemployment of approximately 16.7%, which would put us near 20% unemployment currently in the U.S.

To put that in perspective, here is the last unemployment rates in the U.S. with the expected rate attached to the end.

Estimated unemployment rate

Note the April report won’t look this bad because the unemployment survey is taken in the middle of April. Additionally, I am sure many people will drop out of the work force.