U.S. claims climb to 6.6M last week
More than 6.6 million Americans applied for unemployment benefits last week, far exceeding a record high set just a week prior, a sign that layoffs are accelerating in the midst of the coronavirus.
Initial claims for unemployment insurance in Colorado followed suit.
The 61,583 claims filed last week more than tripled the previous one-week record of 19,745, a mark set during the week that ended March 21, according to the Colorado Department of Labor and Employment. Thousands more have filed applications for benefits or are seeking to do so.
The two-week total of 81,328 claims is only about 20,000 shy of the 102,000 claims the state processed through the entirety of 2019, Ryan Gedney, the Colorado Department of Labor’s senior economist, said during a press call Thursday.
“Not every claimant who
files an initial claim for unemployment benefits is entitled to receive payment,” Gedney said. “However, in this current environment, I expect an extremely high share of first-time filers to receive unemployment benefits.”
Colorado’s unemployment rate for February was a record-low 2.5%, according to the U.S. Bureau of Labor Statistics, a percentage that represents roughly 80,300 people. March unemployment numbers are due out later this month, but Gedney said he doesn’t expect the full effect of the coronavirus crisis to be felt until April numbers are released.
With layoff notices pouring in and adjustments made to state systems to allow more people to file for unemployment online or by phone, the state is moving into territory it hasn’t seen in years. The last time Colorado’s unemployment rate was over 5% was in 2014, federal data shows. On Monday alone, 225,000 calls poured into the department of labor’s call center, officials say.
The 2,519% surge in initial claims filed last week versus the week that ended March 14 is shocking, but it still puts Colorado in the middle of the pack for all states, according to an analysis by the Economic Policy Institute. In Michigan, new claims spiked by more than 5,700%, leading the nation.
The job cuts are mounting against the backdrop of economies in the United States and abroad that have almost certainly sunk into a severe recession as businesses close across the world.
The national figure for last week is much higher than the previous record of 3.3 million reported for the previous week. The surging layoffs have led many economists to envision as many as 20 million lost jobs across the country by the end of April. The unemployment rate could spike to as high as 15% this month, above the previous record of 10.8% set during a deep recession in 1982.
Many employers are slashing their payrolls to try to stay afloat because their revenue has collapsed, especially at restaurants, hotels, gyms, movie theaters and other venues that depend on faceto-face interaction. Auto sales have sunk, and factories have closed.
Stay-at-home orders, imposed by most states including Colorado, have intensified pressure on businesses, most of which face rent, loans and other bills that must be paid.
After Congress passed a $2.2 trillion relief package to soften the economic blow of the pandemic last week, unemployment benefits for many across the country and in Colorado were expanded.
For the first time ever, gig workers and self-employed people are now eligible for benefits, but Cher Haavind, the Colorado Department of Labor’s deputy executive director, said the state is still not ready to accept unemployment applications from those people while it awaits federal guidance. She recommends those who are planning to apply to get their financial documentation ready.
“We are unable to change our business processes until the U.S. Department of Labor issues us guidance on how we can ensure we are in compliance,” Haavind said, adding that all expanded benefits are being funded by the federal government. “We hope that programming can be done fairly quickly. We do not have a date by which we think that might be completed yet.”
The Colorado Department of Labor and Employment created a document breaking down how individuals’ varying employment circumstances dictate the support they may receive. That document is available at ColoradoUI.gov.
The Associated Press contributed to this report.