Over 2.4 million Americans filed for unemployment last week, as coronavirus job losses drag on

Economists surveyed by Refinitiv had forecast 2.4 million.

Over 2.4 million Americans filed for unemployment last week, as coronavirus job losses drag on

More than 2.4 million laid-off workers applied for unemployment last week, the Labor Department reported on Thursday, as the coronavirus pandemic, and the economic catastrophe it's triggered, forced companies to continue slashing jobs.

The new report, which covers the week ending May 16, pushes the nine-week total of losses since states directed residents to stay at home and required nonessential businesses to nearly 39 million. All of the jobs created during the past decade have been wiped out; unemployment at this scale hasn’t been recorded since the Great Depression.

Economists surveyed by Refinitiv had forecast 2.4 million.

Although the number is still grim ⁠— it's the ninth straight week that layoffs were counted in the millions ⁠— it's the lowest amount of jobless claims since the week ended March 15. It's the seventh week in a row of declining jobless claims since the peak of 6.65 million the week ended March 25.

"Given the UI claims totals so far this month, May’s jobs report may see the unemployment rate rise further into the high teens or beyond," said Daniel Zhao, a Glassdoor economist. "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.”

The previous week's total was revised down by 294,000 from 2.98 million to 2.68 million after Connecticut incorrectly reported data for last week.

Economists said claims were also being kept elevated as states started processing applications for hundreds of thousands of gig workers and self-employed individuals. Typically, these workers are not eligible to receive jobless benefits; however, in order to secure the federal aid, they must first apply for state benefits and be denied.

As of Tuesday, 43 states were paying out benefits to those workers, according to the Labor Department.

A majority of U.S. states have started to navigate reopening their economies, which is evident in the data. Georgia, which began easing stay-at-home guidelines at the end of April, saw the biggest decline in jobless claims, which fell 66,224 from a week ago. The number of unemployment claims in California, however, rose by 33,448 from the previous week's total.

Congress has passed four massive economic-relief packages totaling nearly $3 trillion to blunt the virus outbreak's effect on workers and businesses. Last week, House Democrats passed another $3 trillion bill that would include a second round of one-time cash checks to Americans; Senate Republicans have declared the legislation "dead on arrival."

Thursday's report comes on the heels of Federal Reserve Chairman Jerome Powell warning that both the U.S. central bank and Congress may need to pass additional measures to ensure the economy recovers from the worst downturn since the Depression.

"And the question is, will it be enough?" he said. "And I don't think we know the answer to that. It may well be that the Fed has to do more. It may be that Congress has to do more. And the reason we've got to do more is to avoid longer-run damage to the economy."

Published on: May 21, 2020 20:07:59