The news on America's jobs numbers is "chilling" after massive shutdowns to slow the spread of coronavirus, but the nation should see a huge rebound in the third quarter of this year, White House senior economic adviser Kevin Hassett said Wednesday.
"I think it is very important to let people understand in a very somber way, this is the biggest shock our economy has ever seen, but it is something that we've done in order to get ahead of the curve on the disease," Hassett told Fox Business' "Mornings with Maria." "(It is) something that we can reverse, hopefully relatively quickly."
According to the ADP National Employment Report released Wednesday, the shutdowns could create a lasting effect on the economy, even while parts of the country are moving to reopen non-essential businesses. The report shows U.S. private employers laid off a record 20.236 million workers in April because of the mandatory business closures.
The shutdowns mean the second-quarter results will be a "massively negative number," said Hassett, putting his guess at a GDP of "probably minus 40%."
However, he said he thinks the third quarter will be a "very, very large positive number, because we are going from stop to not stopped."
"Economist Milton Friedman said the economy is like a string," said Hassett. "If you pull it down further, then it snaps back faster. That is what President (Donald) Trump is hoping for. Our economic team trying to design a policy to make sure that is what is happening."
Meanwhile, a large percentage of people who are filing for unemployment claims are actually furloughed workers going through temporary layoffs, said Hassett.
"If businesses can start up again soon, hopefully, those folks will reconnect," said Hassett, adding that the Paycheck Protection Program can help some of them reconnect with their jobs.
"We're in a wait and see mode we want to see how effectively people can turn economies back on, how much output we get when they do, and so on," said Hassett.
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