USA TODAY International Edition
Jobless claims pushed past 38M
Layoffs fueled by the coronavirus pandemic continue to mount, even as more states allow businesses to reopen after ordering them to shut to slow the spread of the virus.
About 2.4 million Americans filed initial unemployment benefit claims last week, the Labor Department said Thursday, as the health and economic crisis sparked by the coronavirus ruptures a growing number of industries.
In just nine weeks, 38.6 million have sought jobless benefits that represent the nation’s most reliable gauge of layoffs.
There were encouraging signs in the labor report. The latest claims tally was down from the 3 million who filed claims the week before, and the record 6.9 million who sought assistance in late March. Initial applications for unemployment insurance have now steadily declined seven weeks in a row.
But the tens of millions of Americans who have applied for assistance in just over two months is still a staggering number, reflecting a 14.7% jobless rate that is the highest since the Great Depression.
“In only nine weeks, unemployment claims made during the coronavirus crisis have already exceeded the 37 million claims made over the entire 18 months of the Great Recession,” Daniel Zhao, senior economist for the jobs site Glassdoor, said in a statement. “While recent indicators show the initial steep job declines are slowing, the labor market remains in a deep hole it will have to climb out of.”
How quickly that rebound occurs depends on how fast businesses can get up to speed as the country reopens.
Most states are moving forward with phased- in approaches. And restaurants and retailers are taking tentative steps towards wooing back customers.
Cities from Tampa, Florida, to Portland, Maine are allowing outdoor dining to enable locals to eat at an actual restaurant once again while maintaining social distancing. And Macy’s, which closed its locations across the U. S. March 18, plans to reopen 80 stores on Friday.
That move means roughly 80% of the retailer’s locations will be open or offering curbside pickup in time for the Memorial Day weekend.
“We will continue to watch customer behavior closely as we reopen more stores, and we will remain agile and adjust our plans as we go forward and open up the remaining series of stores,” Jeff Gennette, Macy’s chairman and CEO said in a call with analysts Thursday.
“The labor market continues to struggle amid the COVID- 19 pandemic and filings for unemployment benefits are likely to remain at elevated levels even as some states begin to gradually reopen their economies and ease back some social distancing measures,” BofA Research said in an investors note.
In the early weeks of the pandemic, the retail, hospitality and leisure sectors were especially hard hit as stay- athome orders were put in place, stores and restaurants closed, and travel nearly ground to a halt.
But the pandemic’s toll is now rippling out to other industries. More recently, companies such as Uber and General Electric have laid off thousands of employees. Construction and the professional services sector have also suffered job cuts.
The deluge of claims for unemployment aid hobbled state systems around the country, which struggled to process the millions of applications. But the backlog appears to finally be easing.
The Treasury Department has reported that $ 48 billion in assistance was dispensed in the first half of May, equal to the aid delivered during the month of April, Stettner said.
A record 20.5 million jobs were lost in April, according to the Labor Department, leading to an unemployment rate that more than tripled the 4.4% jobless rate reported in March, and the 3.5% unemployment rate in February that represented a 50- year low.