By Eric Morath 

WASHINGTON -- The unemployment rate could move above 20% in May, but the U.S. economy is showing nascent signs of recovery from the damage done from shutdowns caused by the coronavirus pandemic, White House economic adviser Kevin Hassett said Sunday.

Mr. Hassett pointed to businesses reopening and credit-card data showing consumers are starting to increase spending as signs the economy is beginning to improve.

But he said May's unemployment rate, which measures joblessness in the middle of the month, could "end up with a number north of 20%." April's rate, 14.7%, was the highest on record back to 1948.

"I think we're very, very close to an inflection point in terms of business activity, and probably about a month away in terms of employment," he said on CNN's "State of the Union."

Mr. Hassett, an economist, said he thought the unemployment rate would begin to fall in June, but would remain above 10% this fall, when Americans head to the polls for the presidential elections. Voters, he said, will be focused on a rapidly improving economy, not a historically high rate of joblessness.

Mr. Hassett's comments on the economy are in line with other economists who expect the U.S. economy to feel the effects of pandemic-caused economic shock for many months, if not years.

Economists views vary widely, from those who expect the economy to largely recover this year to those who expect the recovery to take more than five years. Many say how the pandemic unfolds and if a vaccine is developed will play a large role.

The nonpartisan Congressional Budget Office issued projections last week showing the economy will severely contract in the spring months and rapidly grow in the summer months, but not fast enough to fully offset the downturn. Mr. Hassett said he generally agrees with those forecasts.

"In some states, as many as 90% of businesses are open now, and you're not seeing the kind of movement that you would see if the virus were completely gone," he said. "And so, for sure, it's going to be something that's negative, that's holding things back...going into the fall."

Mr. Hassett added that by the fall, "all the signs of economic recovery are going to be raging everywhere." He said businesses have the capacity to quickly ramp up and that unemployed Americans are ready to return to work, factors that could fuel a fast recovery.

Write to Eric Morath at eric.morath@wsj.com

(END) Dow Jones Newswires

May 24, 2020 11:28 ET (15:28 GMT)