US unemployment claims soar to 6.6million

The number of Americans filing claims for unemployment benefits last week has shot to a record 6.6 million – as layoffs increased amid the coronavirus pandemic and more states enforced stay-at-home orders.  

Initial claims for unemployment benefits rose to 6.65 million in the latest week from the 3.3 million the previous week, according to new figures released by the Department of Labor on Thursday. 

It means that 10 million Americans have filed for unemployment in the two weeks that the coronavirus started rapidly spreading across the country.  

The new figures account for claims made in the week ending March 28. 

The 6.6 million figure is much higher than the previous record of 3.3 million reported for the week ending March 21. 

The new figures account for the week in which states like New York shuttered non-essential businesses. 

More than 80 percent of Americans are now under some form of lockdown – up from less than 50 percent just a few weeks ago.   

Some of last week’s jobless claims could be delayed filings from the previous week when state offices that handle unemployment benefits were overwhelmed by a surge of online and telephone claims.

There is anecdotal evidence that people who have tried to file claims online have not been able to with some forced to wait five hours to log onto the website and others calling hundreds of times just to get through. 

The government’s weekly report, the most timely data on the economy’s health, offered the clearest evidence yet that the longest employment boom in US history likely ended in March. 

Before the virus hit, unemployment in the US was at its lowest in 60 years and the economy was stronger than it had ever been. 

The surging layoffs have led many economists to envision as many as 20 million lost jobs by the end of April. 

Many employers are continuing to slash their payrolls to try to stay afloat during the pandemic because their revenue has collapsed, especially at restaurants, hotels, gyms, movie theaters and other venues that depend on face-to-face interaction. 

Stay-at-home orders, imposed by most US states, have intensified pressure on businesses, most of which face rent, loans and other bills that must be paid. 

The outbreak has spurred an unprecedented surge in Americans seeking government assistance. 

They have already outstripped applications for unemployment benefits that peaked at 665,000 during the 2007-2009 recession, during which 8.7 million jobs were lost. 

Economists say the country should brace for jobless claims to continue escalating, partly citing generous provisions of a historic $2.2 trillion fiscal package signed by President Donald Trump last week and the federal government’s easing of requirements for workers to seek benefits.

As a result, self-employed and gig-workers – like Uber and Lyft drivers – who previously were unable to claim unemployment benefits are now eligible. 

In addition, the unemployed will get up to $600 per week for up to four months, which is equivalent to $15 per hour for a 40-hour workweek. 

By comparison, the government-mandated minimum wage is about $7.25 per hour and the average jobless benefits payment was roughly $385 per person per month at the start of this year.

Last week’s claims data has no bearing on the closely watched employment report for March, which is scheduled for release on Friday. 

For the employment report, the government surveyed businesses and households in the middle of the month, when just a handful of states were enforcing ‘stay-at-home’ or ‘shelter-in-place’ orders. 

It is, however, a preview of the carnage that awaits as the coronavirus pandemic worsens. 

Retailers including Macy’s, Kohl’s Corp and Gap Inc said on Monday they would furlough tens of thousands of employees as they prepare to keep stores shut for longer.