Paulson Says Unemployment to Stay High Even as Economy Recovers

Unemployment in the U.S. will remain at an “unacceptable level” even as the nation’s economy expands, former U.S. Treasury Secretary Henry Paulson said.

“We are going to see economic growth picking up, but unemployment” will stay “at an unacceptable level for a number of years,” Paulson said today in Hong Kong. “We are going to make slow and steady growth, but we need to create more jobs.”

China should continue pursuing changes in its currency system, said Paulson, who is now an adviser to Coda Automotive, an electric-carmaker based in Santa Monica, California. The nation understands a more flexible currency can help manage inflation, he said. He also said the relationship between China and the U.S. is “healthy.”

Paulson, 65, was Treasury secretary from 2006 to 2009 under then President George W. Bush. He proposed the $700 billion Troubled Asset Relief Program to Congress after the Sept. 15, 2008 collapse of Lehman Brothers Holdings Inc., which led to capital injections in banks including Goldman Sachs Group Inc. (GS), Citigroup Inc. (C) and Bank of America Corp.

To contact the reporter on this story: Sophie Leung in Hong Kong at sleung59@bloomberg.net

To contact the editor responsible for this story: Paul Panckhurst in Hong Kong at ppanckhurst@bloomberg.net