WASHINGTON — The coro­n­avirus pan­demic sent the U.S. econ­omy plung­ing by a record-shat­ter­ing 32.9% an­nual rate last quarter and is still in­flict­ing dam­age across the coun­try, squeez­ing al­ready strug­gling busi­nesses and forc­ing a wave of lay­offs that shows no sign of abat­ing.

The econ­omy’s col­lapse in the April-June quarter, stun­ning in its speed and depth, came as a resur­gence of the vi­ral out­break has pushed busi­nesses to close for a sec­ond time in many ar­eas. The govern­ment’s es­ti­mate of the sec­ond-quarter fall in the gross do­mes­tic prod­uct has no com­par­i­son since records be­gan in 1947. The pre­vi­ous worst quar­terly con­trac­tion — at 10%, less than a third of what was re­ported Thurs­day — oc­curred in 1958 dur­ing the Eisen­hower ad­min­is­tra­tion.

So steep was the eco­nomic fall last quarter that most an­a­lysts ex­pect a sharp re­bound for the cur­rent July-Septem­ber pe­riod. But with coro­n­avirus cases ris­ing in the ma­jor­ity of states and the Repub­li­can Se­nate propos­ing to scale back aid to the un­em­ployed, the pain is likely to con­tinue and po­ten­tially worsen in the months ahead.

The plunge in GDP “un­der­scores the un­prece­dented hit to the econ­omy from the pan­demic,” said An­drew Hunter, se­nior U.S. econ­o­mist at Cap­i­tal Eco­nom­ics. “We ex­pect it will take years for that dam­age to be fully re­cov­ered.”

That’s be­cause the virus has taken square aim at the engine of the Amer­i­can econ­omy — con­sumer spend­ing, which ac­counts for about 70% of ac­tiv­ity. That spend­ing col­lapsed at a 34.6% an­nual rate last quarter as peo­ple holed up in their homes, travel all but froze and shut­down or­ders forced many res­tau­rants, bars, entertainm­ent venues and other re­tail es­tab­lish­ments to close.

Ten­ta­tive hopes for a swift re­cov­ery have been di­min­ished by a resur­gence of vi­ral cases in the South and the West that has forced many busi­nesses to close again or re­duce oc­cu­pancy. Be­tween June 21 and July 19, for ex­am­ple, the pro­por­tion of Texas bars that were closed shot from 25% to 73%. Like­wise, 75% of Cal­i­for­nia beauty shops were shut­tered July 19, up from 40% just a week ear­lier, ac­cord­ing to the data firm Wom­ply.

The sec­ond surge does ap­pear to be lev­el­ing off, but cases are still ris­ing in close to 30 states.

Many states have im­posed re­stric­tions on vis­i­tors from the states that have re­ported high lev­els of cases, hurt­ing ho­tels, air­lines and other in­dus­tries that de­pend on travel.

That has led to mam­moth job losses. In a sign of how weak­ened the job mar­ket re­mains, more than 1.4 mil­lion laid-off Amer­i­cans ap­plied for un­em­ploy­ment ben­e­fits last week. It was the 19th straight week that more than 1 mil­lion peo­ple have ap­plied for job­less aid. Be­fore the coro­n­avirus erupted in March in the U.S., the num­ber of Amer­i­cans seek­ing un­em­ploy­ment checks had never ex­ceeded 700,000 in any one week, even dur­ing the Great Re­ces­sion.

An ad­di­tional 830,000 peo­ple ap­plied for un­em­ploy­ment ben­e­fits un­der a new pro­gram that ex­tends el­i­gi­bil­ity for the first time to self-em­ployed and gig work­ers. All told, the govern­ment says roughly 30 mil­lion peo­ple are re­ceiv­ing some form of job­less aid, though that fig­ure might be in­flated by dou­ble-count­ing by some states.

The pain could soon in­ten­sify fur­ther: A sup­ple­men­tal $600 in weekly fed­eral un­em­ploy­ment ben­e­fits is ex­pir­ing, and Congress is squab­bling about ex­tend­ing the aid, which will prob­a­bly be done at some re­duced level of pay­ment.


A “for rent” sign hangs on a closed shop this month in Mi­ami Beach, Fla.

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