Unemployment claims remained high last week at 6.6 million, the Labor Department reported, as massive job losses continued to pile up from the coronavirus pandemic.
The claims, for the week ending April 4, flooded in as confirmed coronavirus cases approached 300,000 and as nearly every state ordered its citizens to stay at home. Economic forecasts are becoming routine that predict unemployment will exceed its historic 25 percent peak during the Great Depression, and the number of jobs lost in a mere three weeks now exceeds the 15 million that it took 18 months for the Great Recession to bulldoze from 2007 to 2009.
“In its first month alone, the coronavirus crisis is poised to exceed any comparison to the Great Recession,” said Glassdoor Senior Economist Daniel Zhao in a statement. “The new normal for UI claims will be the canary in the coal mine for how long effects of the crisis will linger for the millions of newly unemployed Americans.”
The jobless claims are mounting as the federal government struggles to release waves of aid to the economy as businesses shutter. The Federal Reserve on Thursday unveiled emergency programs that could dole out more than $2 trillion in loans to businesses of all sizes, as well as to struggling state and city governments. Democrats and Republicans in the Senate clashed Thursday over a new aid package aimed at bolstering the $2 trillion economic rescue deal that lawmakers approved in March.
The 16.8 million unemployment claims filed between March 15 and April 4, translates to more than one in ten workers seeking jobless benefits, according to Heidi Shierholz, policy director at the left-leaning Economic Policy Institute. “We are nowhere near the end of this,” she tweeted. “The labor market has been upended.”
State unemployment agencies and the Department of Labor continued to struggle to process claims from a pool of eligible workers that now includes gig workers, independent contractors, and workers who in ordinary times wouldn’t have worked long enough to qualify for benefits, but became eligible as a result of Congress’s $2 trillion coronavirus rescue package last month. That bill also increased employment benefits by $600 across the board.
The 6.6 million claims filed last week would have set a record going back to 1967, when the Labor Department’s data series began, had the previous two weeks’ claims not done so already.
“This is a catastrophe,” said Rep. Don Beyer (D-Va.), vice chairman of the congressional Joint Economic Committee, in a statement. “Nearly 17 million Americans have lost their jobs and they likely won’t find another one until the contagion is under control—and that may be a long way off.”
The Bureau of Labor Statistics reported last week that U.S. employers shed 701,000 jobs in March, pushing the unemployment rate up to 4.4 percent, but the survey week for that figure was mid-March, before the crush of claims began. Most estimates put the current unemployment rate in the double digits or close to it.
As policymakers struggled to come to terms with the economic fallout from the pandemic, one economist suggested last month’s expansion of unemployment benefits, including $600 added to every unemployment check through July, could blunt losses from mass layoffs.
Although the unemployment rate “could rise even higher over the coming months,” wrote Andrew Hunter, senior U.S. economist at Capital Economics, “the damage in terms of lost income may end up being less severe.”
DOL again attributed the jump in claims to the spread of Covid-19. In previous weeks, the agency said the claims were concentrated in the services industries, as well as the health care, manufacturing, retail and construction industries.
The greatest number of new unemployment claims were in California, which processed an estimated 925,450 claims last week. After California, Georgia was second with 388,175 new claims.
