Joblessness hits grueling heights
Record 6.6 million Americans file for unemployment in past week
Engulfed by the coronavirus pandemic, the U.S. economy continues to rack up job losses the nation has never seen before.
A record 6.6 million Americans filed for new unemployment claims for the week ended March 28, according to a Department of Labor report released Thursday. The staggering number of people seeking help was double the previous record of 3.3 million new claims, set just a week earlier.
Even the stunning 10 million jobs lost in two weeks likely is just the start of a crescendo of joblessness, economists said, as the nation reels from stayathome orders designed to curb the spread of the virus. Stores, hotels, factories, schools, airlines, restaurants, nightclubs, film sets, construction sites and more have shuttered or drastically curtailed business while consumers are cloistered at home.
“From something bad, something good can come. We spend more time all together.”
Elena Duran, lost her job at the Palace Hotel
“We’re in the Great Depression neighborhood here,” said Michael Merrill, professor of labor studies and employment relations at Rutgers University.
Economists at the St. Louis Federal Reserve predict that the country will lose 47 million jobs in the second quarter, reaching a 32.1% unemployment rate. During the darkest days of the Depression, unemployment was about 25%.
But there are some major lifelines now that weren’t offered then. The government is pouring money into additional unemployment benefits and other assistance to try to keep people and businesses afloat.
“The stimulus just passed will make a difference, although there will be casualties from economic disruption,” Merrill said.
Many restaurants and shops may go belly up, leaving their workers — generally lowerpaid people — stranded.
There’s still the hope that the economy could bounce back once the virus subsides.
“Since this slowdown is largely selfimposed, rather than the result of deep structural problems in the economy, the eventual recovery should be swift,” write Michael Farren, an economist at George Mason University, in an opinion piece in the Hill, a political publication, on Thursday.
The official report showed that 878,727 Californians filed new claims for the week of March 2228, compared to 186,333 the week before. While more than twice the claims reported in any other state, that’s just a hint at the true figure. It includes only claims that were fully processed. The state’s count of claims received is many times larger.
Gov. Gavin Newsom said Thursday that more than 1.9 million state residents had filed for unemployment since midMarch, including a record 150,000 on Monday alone. Unemployment claims are averaging 111,000 per day, he said.
The state is putting $50 million into a program for smallvalue loans. It will let small businesses defer paying up to $50,000 in sales taxes for one year with no fines or penalties — essentially a nocost loan.
“We all recognize we’re going to have to do more to meet this moment for employees and employers,” he said on Tuesday.
Every single state recorded its highestever unemployment toll during the week ended March 28 or that ended March 21.
The pain of layoffs rippled through entire families.
Elena Duran and her husband, Carlos Narvaez, both 65, both lost jobs at the Palace Hotel in San Francisco on March 16, the day several Bay Area counties issued shelterinplace orders. Their hours had previously been cut. All three of their adult sons were laid off, too, including Victor Narvaez, 28, who lives with them in a Mission District apartment along with Carlos’ 87yearold mother, who has dementia. Duran expects at least one of her other sons may need to move in soon.
“It is going to get tight, yes,” Duran said. Still, she likes to look on the bright side. “From something bad, something good can come,” she said. “We spend more time all together.”
The extra $600 a week of unemployment benefits that Congress included in the stimulus package passed last week will help, she said. She’s hopeful that her union, Unite Here Local 2, will persuade Marriott, the global hotel chain that operates the Palace, to share some of its stimulus money with its workers, and to cover health care after the current reserve fund is exhausted in July.
The hospitality industry has endured some of the biggest cuts. More than 12,000 Unite Here Local 2 jobs in hotel, airport and food service work in San Francisco and San Mateo counties have vanished; the union is raising funds to support its workers.
Some newly laidoff workers said it was clear that the state unemployment system is swamped.
Larrilou Carumba, 47, was laid off in early March after eight years as a housekeeper at the San Francisco Marriott Marquis.
“I applied for unemployment the first week, but it took me four days,” she said. “Day and night I tried to apply, but the website kept crashing.”
She was notified last week that her application was approved, but she hasn’t received her benefits.
“Every day I’m waiting and wondering when it will come,” she said. A single mother of three, she and her children are staying in a room in her sister’s San Leandro house, but she still has a lot of bills to juggle. Her sister, a mother of two, also was laid off, although her brotherinlaw is still working.
The California Employment Development Department said it had “massive aroundtheclock staffing and IT efforts” to handle the overwhelming volume. It’s enlisted 850 additional staff to process claims.
Still, the state Legislative Analyst’s Office said the onslaught of applications likely will delay people receiving their benefits, which usually takes about three weeks after submitting an application. During the crisis, California will pay benefits before making final eligibility decisions, it said.
An extra $600 a week included as part of the $2.2 trillion stimulus package should be added to Californians’ unemployment benefits next week “barring any big surprises” in guidelines from the federal government, EDD said. It’s also waiting for guidelines to start granting a 13week extension of benefits included in that package. Ordinarily California unemployment is 26 weeks within a 52week time period.
The EDD is working to create an application for the new Pandemic Unemployment Assistance program, which will provide unemployment benefits to gig workers, freelancers and the selfemployed. It didn’t say when this will be ready.
Updates will be posted on the EDD website, which has a special coronavirus information section, as soon as more details are available.