36m Americans now unemployed as another 3m file for benefits
The terrible toll of the coronavirus pandemic on the US economy continued unabated last week as another 3 million people filed for unemployment benefits and official figures showed 40% of low-earning families had now lost a breadwinner.
The latest figures from the labor department mean more than 36 million people have filed for benefits in the last two months. The rate of claims is slowing but the record-breaking pace of layoffs has already pushed unemployment to levels unseen since the Great Depression of the 1930s. For comparison, just 188,264 unemployment claims were filed in the same week in 2019.
This week the Department of Labor started releasing figures for those eligible to file for benefits under the Pandemic Unemployment Assistance (PUA) program, a federal unemployment scheme set up for the selfemployed and gig workers like Uber drivers who had previously not been eligible to make claims. Some 841,995 people made claims under PUA for the week ending 9 May.
Some states have begun to relax quarantine rules and open more businesses, a trend that is likely to help reverse some recent job losses. But many states are still dealing with an overwhelming backlog of claims, so the true number of job losses is still underrepresented by the government figures.
The already financially vulnerable have been hit hardest by the quarantine shutdowns. On Thursday, the Federal Reserve released a report detailing who has been hurt by the economic meltdown. The Fed chair, Jerome Powell, said: “While we are all affected, the burden has fallen most heavily on those least able to bear it.”
Nearly 40% of households earning less than $40,000 had experienced job losses, according to the report.
Of the 19% of Americans who had their hours cut or lost a job in March, 8% said medical costs would deter them from seeking care if they had coronavirus symptoms. The report showed before the pandemic, 25% of adults said they skipped medical care in 2019 because they couldn’t afford it.
The findings were part of an annual Federal Reserve report on the economic wellbeing of US households. Ahead of its release, the agency did a second survey to reflect the dramatic change in the US economy because of the pandemic.
Among those experiencing a job loss or hours reduction in March, 64% said they could pay all their bills, in full, in April, compared with 85% of those whose employment stayed the same.
“Recognizing that the April supplement was fielded relatively soon after families began to experience the financial repercussions of Covid-19, these results may not reflect the full extent of financial hardship that will result from the pandemic,” the report said.
Despite the unprecedented job losses, nine out of 10 Americans who were furloughed or lost their job told the Federal Reserve that their employer indicated they could return to their job at some point – though 77% of them were not given a return date.
Last week the Department of Labor said some 20 million people had lost their jobs in April as the unemployment rate shot up to 14.7% from just 4.4% in March. The figures showed the sharpest rises in unemployment were suffered by those without college educations, African Americans and Latinos.
Jilma Guevara was laid off at the end of March from her job as a security officer for a contract company in the cargo area of Miami airport in Florida and is worried that she will not be able to go back to work even when things reopen.
Guevara says she tried to organ
ize her fellow security officers in the cargo area when her company was not giving her and her co-workers proper protective gear. They laid her off, but others with less seniority – Guevara has worked for the company for six years – are still working.
It took a month for Guevara’s unemployment claim to successfully get through Florida’s system and receive payments. While she has support from friends, she is unable to support her family in Nicaragua and is worried about how much longer she can go without a job.
“I worry about not being able to pay my rent a lot,” Guevara said in Spanish through a translator. “I think I was laid off because I was trying to organize my workers, so I see my future as very dark without a lot of hope.”