Claims for unemployment benefits spike as coronavirus forces thousands of layoffs
The number of Americans who applied for unemployment benefits soared last week as businesses shuttered because of the coronavirus pandemic began laying off workers.
Weekly claims for unemployment insurance rose to 281,000 between March 8 and 14, spiking 70,000 from the 211,000 applications for jobless benefits filed between March 1 and 7.
The sharp rise in claims for unemployment insurance comes as businesses in the entertainment, restaurant and bar, travel, retail, and hospitality industries face mandatory closures across the U.S. as the coronavirus pandemic escalates.
The Centers for Disease Control and Prevention has warned Americans to avoid gatherings of more than 10 people and to stay at least six feet away from any other person as confirmed cases of the novel coronavirus steadily rise.
Those measures — along with the state and local edicts used to enforce them — could cost millions of service industry workers and business owners their jobs and livelihoods.
At least 3 million people could lose their jobs by the summer, according to an analysis from the Economic Policy Institute (EPI), a left-leaning think tank. But it could take several weeks for those layoffs to show up in jobless claims.
“While coronavirus layoffs began last week, the full weight of the impact — while swift — is still ramping up as businesses realize what they are up against,” wrote EPI senior economist and policy director Heidi Shierholz on Wednesday.
“This means that we should look at the numbers that come out [Thursday] as just the leading edge of the labor market impact of the coronavirus shock.”
Public health officials warn that it could take weeks, if not months, until the coronavirus subsides enough to allow Americans to return to normal social life.
The unprecedented economic shock has prompted President Trump and lawmakers to negotiate over a $1 trillion fiscal stimulus and economic rescue package. The bill is likely to include billions of dollars in direct payments to U.S. adults and households, bolstered unemployment benefits, bailouts for vulnerable industries and low- or no-interest loans for struggling businesses.
Sen. Marco Rubio (R-Fla.), who is charged with the Senate GOP’s proposals for business relief, said Thursday that his colleagues may propose “forgivable” loans to small businesses to prevent firms from laying off workers.
“Whatever they take out from this assistance program & use for payroll & business and rent/lease/mortgage will NOT have to be repaid. Limit on what they get will be some multiple of their payroll/expenses before the crisis hit,” Rubio tweeted Thursday.
Rubio added that the loans would be offered through banks, credit unions and other private-sector lenders and would be available to a wide range of for-profits, nonprofits, sole proprietorships and corporations.
Senate Republicans are aiming to pass the bill by the end of next week.
Updated at 9:08 a.m.
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