Between 1931 and 1940, the MINIMUM monthly unemployment rate was 11% in July 1937, and the average jobless rate was 17.3% (see chart above). It seems very likely that the MAXIMUM unemployment during the current recession won't reach the MINIMUM of 11% during the Great Depression.
According to the Philadelphia Federal Reserve Survey of Professional Forecasters (released February 13, new survey is due out this Friday), the average unemployment rate expected for 2009 is 8.4% and the average forecast for 2010 is 8.8%. Obviously these forecasts will be adjusted upward this Friday, but it still seems probable that the jobless rate in this recession won't even reach the minimum monthly rate of the 1930s, and certainly won't come anywhere close to the 17.3% average jobless rate during the Great Depression. For a related analysis, see Freakonomics post "This is Not Another Great Depression"
For a related analysis, see Freakonomics post "This is Not Another Great Depression"
Note: Unemployment insurance didn't exist until 1935.
Real GDP contracted annually by about 8%, 6% and 13% in the first three years of the Great Depression, for a cumulative decrease of more than 27% (see chart above). According to the Philadelphia Federal Reserve Survey of Professional Forecasters (released February 13, to be updated this Friday), real GDP will contract this year by -2.0 before increasing by 2.2% next year. Even if real GDP contracts by much more than 2% this year before returning to positive growth next year, it will be nothing close to the contraction in real GDP of the early 1930s.
"This is Not Another Great Depression," which concludes: "We are experiencing pain now, but the problems of the Great Depression were several magnitudes greater."
Related: The White House is projecting that the nation's economy will shrink by 1.2% this year and increase by 3.2% next year. In addition, it projects that "by the end of this year," the economy will be growing at a 3.5% annual rate.