BLEAK JOB FRONT
Recovery pace disappoints as 1.3M more seek relief
The coronavirus crisis has forced American workers to file nearly 50 million applications for unemployment benefits in just four months, including 1.3 million last week, new federal data show.
Thursday’s US Department of Labor figures suggest the virus has sidelined more than 30 percent of the nation’s workforce at some point since midMarch in the worst employment crisis since the Great Depression.
While millions of Americans have returned to work in the last two months, COVID-19 is likely to keep the job market under pressure as consumers remain wary of the virus and several states grapple with a surge in infections.
“The job market has recovered — that’s positive, but the pace of recovery is not what people wanted it to be,” unemployment insurance expert Andrew Stettner told The Post.
“Whether or not the virus is spiking, and whether or not businesses are closed, people are not engaging in the kind of economic activity that requires people to be close together,” added Stettner, a senior fellow at the Century Foundation think tank. “That’s being depressed everywhere.”
Thursday’s numbers were better than economists expected, but initial jobless claims have plateaued at a level that would have been unthinkable before the pandemic, despite falling sharply from their peak of 6.8 million.
The weekly totals have hovered between 1 million and 2 million for six consecutive weeks, well above the Great Recession’s high of 665,000.
Continuing claims, which track ongoing unemployment on a one-week lag, also remain startlingly high. There were 18 million during the week ended June 27, compared with 18.7 million the prior week and just 1.7 million in the first week of March, the feds’ data show.
“We can’t keep getting record amounts of unemployed and pretend that the economy is OK and the recession is in its final days,” said Chris Rupkey, chief financial economist at MUFG Union Bank.
Jobless workers will likely see their unemployment checks shrink by $600 at the end of July, when expanded benefits provided under the federal CARES Act are set to expire. That will amount to a 65.8 percent reduction in benefits on average, according to a Century Foundation analysis.
The latest claim numbers came on the heels of last week’s closely watched jobs report, which showed the US economy adding 4.8 million jobs in June while the unemployment rate fell to 11.1 percent.
But the surge in coronavirus cases that came after that data was collected could threaten the nascent economic recovery, experts warn.
The spike has forced some states to close restaurants and bars a second time, once again threatening jobs in the hard-hit hospitality sector. The virus has also forced a growing number of retailers into bankruptcy, with Brooks Brothers becoming the latest victim just this week.
“The rising cases are a powerful reminder that the coronavirus is in the driver’s seat — the economic recovery depends almost entirely on how quickly the public health crisis can be contained,” said Glassdoor senior economist Daniel Zhao.