Coronavirus: Unemployment claims smash all records

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unemployment claims coronavirus

Coronavirus is having an impact on almost parts of the economy, and that too, at a level that hasn’t been seen before. We have already seen several growth indicators pointing to a bleak outlook. Now, the unemployment claims have shattered records as the coronavirus outbreak has shut down much of the country. On Thursday, Labor Department released latest figures showing unemployment claims surging to 3.28 million last week. This number is well above the claims registered during the peak of the Great Recession. Moreover, the experts say the worst is not over yet.

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Unemployment claims break all records

Coronavirus or COVID-19 has impacted all industries with energy, travel, transportation, hotel and restaurants being hit the hardest. As per the American Hotel and Lodging Association, the hotel industry alone has lost about a million jobs this month.

So far, the federal government’s data hasn’t included the information on job losses. However, the Labor Department’s weekly report on unemployment claims now confirms the massive expected rise in people seeking benefits due to the coronavirus outbreak.

As per the data from Labor Department, about 3.28 million Americans filed for the benefits during the week ending March 21. In comparison, the weekly average for the past six months has been 225,000.

Last Thursday, the data from the Labor Department revealed that the unemployment benefits claims increased by 70,000 in the second week of March to reach 281,000.

The latest unemployment claims number is almost five times the initial claims recorded during the peak of the Great Recession. For example, there were about 665,000 new claims in the week ending March 28, 2009. The previous high was 695,000 in the week ending Oct. 2, 1982. Labor Department records go back to 1967.

“If the number of new claims is as high as predicted and if it remains high in coming weeks, unemployment will skyrocket,” a report from the Joint Economic Committee of Congress said.

Unemployment websites crashing

Over the last week, the states that have announced shutdowns include Washington, West Virginia, Delaware, Hawaii, Illinois, Indiana, New Mexico, New York, California, Connecticut, Massachusetts, Michigan, Louisiana, Oregon, Kentucky, and Wisconsin. This means non-essential workers are not working anymore, or almost one in three Americans are staying home while many others are out of work.

The rise in the level of unemployment claims could be gathered from the fact that many unemployment websites are crashing as they are unable to handle the volume of newly-jobless Americans applications, notes a report from Dailymail.

As businesses continue to shut across the U.S., people who have only recently lost their jobs are unable to register for the benefits as Labor Department websites aren’t functioning properly.

“In 5 days, the DUA received around twice as many new unemployment claims as were filed during the entire worst month of the Great Recession,” said …read more

Source:: ValueWalk

      

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