The single biggest issue you'll face is the loss of thermal mass. One of the key reasons that deserts are so hot during the day, so cold at night is that there's no water that soaks up the heat and releases it slowly through the night. In your world, this is now the norm so your days will be extremely hot, and nights extremely cold.
Within the bounds of habitability? With underground homes, perhaps. I wouldn't want to be living on the surface though.
Water in such an environment is very precious, and your inhabitants will most likely have mechanisms similar to those described in Dune for rendering water from the dead and other biological material for re-use. Their Stillsuits would also be a likely invention as you wouldn't want to waste sweat or urine because of the water content.
Of bigger concern would be the impact on vegetation, both marine and land based. The real issue here is that trees (which you'll still need to generate oxygen, especially now the phytoplankton is gone) need lots of water to grow, and they expect to live in an environment where they regularly get rainfall. You've also got the food issue as crops need water. Meat is definitely out because you won't have enough water for grass, and the amount of water required to 'raise' a meal of red meat by comparison to a vegetable based meal is massive.
Even with 10% of the previous water levels, I don't see you rebuilding large cities of any kind because the amount of water required in most mining and industrial applications is prohibitive and the infrastructure required to do so requires seeding from an industrial complex probably from before the water loss.
I'd see society degenerating into small clans, fiercely protecting what water holdings and crops they have the manpower to defend. Clan structures don't scale well, the lack of water also makes trade next to impossible because of the increased cost of 'shipping' and as such, societies won't reach the critical mass of size where there is sufficient food and protection in place to support a small core of researchers or scientists tasked with making things better.