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Goldman Sachs Now Sees U.S. Jobless Rate Peaking at 25%, Not 15%

A pedestrian wearing a protective mask passes in front of an H&M store temporarily closed in the Times Square area of New York on May 12.

A pedestrian wearing a protective mask passes in front of an H&M store temporarily closed in the Times Square area of New York on May 12.

Photographer: Demetrius Freeman/Bloomberg

Goldman Sachs Group Inc. economists revised their forecasts to reflect a gloomier outlook for the U.S. labor market, though also the potential for a faster recovery from the coronavirus pandemic.

Analysts David Mericle and Ronnie Walker estimate that the unemployment rate will peak at 25%, up from a previous forecast of 15%, as “more workers will lose their jobs and a larger share of them will be classified as unemployed,” according to a research note late Tuesday. The rate would then remain near 10% at year-end, near the highs of the last recession, they wrote.