Find out the latest on the stimulus package, unemployment benefits and why you still can’t find toilet paper after 10 a.m. at most stores.
The number of Americans struggling to make ends meets continues to grow, even as the economy begins to restart after virtually shutting down to slow the coronavirus pandemic.
About 2.1 million Americans filed initial unemployment benefit claims last week, the Labor Department said Thursday
In just 10 weeks, 40.7 million have sought jobless benefits, which represent the nation’s most reliable gauge of layoffs.
The volume of claims has been steadily slipping. The latest claims tally fell below the 2.4 million who filed claims the week before, and the record 6.9 million who sought assistance in late March.
And that trend is expected to continue. Economic research consultancy Pantheon Macroeconomics predicts initial unemployment applications could fall below 1 million by the end of next month, “for the first time since mid-March.”
But the number of claims is still immense, reflecting a 14.7% unemployment rate that is the highest since the Great Depression.
Oxford Economics expects the unemployment rate to continue to grow, reaching roughly 20% in May before slowly declining, though it will likely still be in double digits by the end of 2020.
“Even though we look for the economy to recoup 17 million jobs this year, or 60% of lost jobs, the unemployment rate will still be around 10% by year-end,” Oxford said in a note.
The flood of unemployment claims is so great, overwhelmed state systems have struggled to process the millions of applications. While the backlog is easing, it is still significant, says Andrew Stettner, senior fellow at The Century Foundation.
“The percentage of all claims being paid jumped from just 14% by the end of March to 47.3% by the end of April, a big improvement, but still reflecting major delays in payments that have bedeviled state agencies and frustrated millions of workers,” Stettner said in a statement.
As the country gradually begins to reopen, with restaurants, barbershops and other businesses welcoming back customers, a rebound could be on the horizon, economists say.
“Tentative signs of economic stabilization are … beginning to emerge,” Ksenia Bushmeneva, an economist with TD Economics, said in an investors note. “However, the economy is still in a very deep hole, … While the worse in terms of shutdowns is likely in the rear-view mirror, navigating the economy out of the crisis will take some time as the rate of recovery will differ across states and industries.”
In the early weeks of the pandemic, the…
Go to the news source: 2.1M file for unemployment benefits amid COVID-19