As unemployment continues to rise, the US could face another crisis: Homelessness across the country could increase by 45%

Sarah Al-Arshani May 14, 2020  INSIDER

Pedestrians walk to the edge of the sidewalk to avoid stepping on people in tents and sleeping bags in the Tenderloin area of San Francisco. AP Photo/Ben Margot


Homelessness in the US could go up by 45% as a result of unemployment due to the coronavirus pandemic, according to a new study from an economics professor at Columbia University. 

More than 800,000 people could be homeless by the summer. 

The unemployment rate in the US reached 14.7%, which hasn't been seen since the Great Depression.
Homelessness in the United States could increase by as much as 45% by the end of this year, according to a new study from a Columbia University economics professor.

Millions of Americans have filed for unemployment as many businesses across the country shutter due to stay-at-home orders and closures of non-essential businesses in an effort to limit the spread of the new coronavirus.

The report by Dan O'Flaherty, who is an expert on the economics of homelessness, "projects an increase in homelessness by 40-45% this year over January 2019."

That means around an additional 250,000 people will be without housing, "if homelessness follows unemployment the way that it has done so in the earlier part of this century," according to the model used for this study.

According to the Department of Housing and Urban Development, 568,000 people were homeless in January 2019. According to the study, more than 800,000 people could be homeless by this summer.

Some have already been forced to live in their cars or on the streets as a result of losing their job during the pandemic. One couple in Los Angeles previously told Business Insider that they lost their part-time jobs as security guards at a restaurant early into the pandemic and have been forced to live in their car.

The study notes that the unemployment rate in the US reached 14.7%, which hasn't happened since the Great Depression. The rate has not peaked yet, and California alone has already predicted that its unemployment rate could peak at 24.5%.

"This is unprecedented," O'Flaherty said, according to the study. "No one living has seen an increase of 10% of unemployment in a month."

According to the Los Angeles Times, California, which already has a quarter of the country's homeless population would likely see a "smaller increase in homelessness than the nation overall."

The study estimates that the state would see a 20% increase from 150,000 to 180,000 people. That's because the study mostly looked at a constant rise in unemployment across the US, so states that had fewer homeless people would likely see a larger increase.

More than 36 million Americans applied for unemployment during the last two months.

According to the LA Times, some economists say that the economic toll of the pandemic is likely to only get worse.

On Wednesday, citing a separate Federal Reserve survey, Federal Reserve Chair Jerome Powell said: "Among people who were working in February, almost 40% of those in households making less than $40,000 a year had lost a job in March."

"This reversal of economic fortune has caused a level of pain that is hard to capture in words, as lives are upended amid great uncertainty about the future," Powell added.