COVID-19 danger continues to drive joblessness in U.S.

The number of Americans applying for unemployment benefits fell last week to 860,000, a historically high number of people that illustrates the broad economic damage still taking place nine months after the first case of COVID-19 was detected in the U.S.

The Labor Department said Thursday that U.S. jobless claims fell by 33,000 from the previous week and that 12.6 million are collecting traditional unemployment benefits, compared with just 1.7 million a year ago.

The pandemic has delivered a colossal shock to the economy. Until the pandemic upended the operations of American companies, from factories to family diners, weekly jobless aid applications had never exceeded 700,000 in the U.S. They’ve topped 700,000 for 26 consecutive weeks.

The overall economy, as measured by the gross domestic product, collapsed at an annual rate of 31.7 percent from April through June, by far the worst three months on record, as millions of jobs disappeared.

The economy and job market have recovered somewhat from the initial shock. Employers added 10.6 million jobs from May through August, but that’s still less than half the jobs lost in March and April.

The recovery remains fragile, imperiled by continuing COVID-19 infections as schools begin to reopen, and the failure to deliver another economic rescue package in Washington. And companies continue to lay off workers as they absorb sales lost to the pandemic.

Raytheon Technologies Corp. this week said it plans to slash more than 15,000 jobs this year at its corporate offices, at jet engine-maker Pratt & Whitney and at its aviation and military equipment manufacturer Collins Aerospace.

A sharp drop in travel has left the airlines with tens of thousands more employees than they need to operate the vastly reduced number of flights. This spring, the airlines began receiving $25 billion in federal grants and loans to keep workers on their payrolls for six months. With that money ending Sept. 30, the three biggest U.S. carriers are expected to furlough or lay off about 40,000 workers starting Oct. 1.

An extra $600 in weekly unemployment benefits ran out July 31, squeezing households that had depended on the beefed-up payments. President Donald Trump issued an executive order Aug. 8 providing a scaledback version of the expanded jobless aid. Most states signed up for federal grants that let them increase weekly benefits by $300 or $400. That program is expiring. “Layoffs remain widespread and a historically high number of individuals are still receiving some type of jobless benefits,“Nancy Vanden Houten, lead U.S. economist at Oxford Economics, wrote in a resarch report. “Failure on the part of policymakers to enact another fiscal relief package poses significant downside risks to the economy and labor market as the recovery appears to be losing momentum.”

Charissa Ward, 37, was furloughed in April from her job as a server at a restaurant in Disney’s Hollywood Studios resort near Orlando, Florida. Since then, she’s been helping at her partner’s online retail business, applying for jobs and waiting to see what Disney will do. “We have no idea when we’re going to get called back,” she said.