3M more Americans file for unemployment benefits as coronavirus economic impact expands
Just under 3 million people applied for initial unemployment claims in the week ending May 9, according to Labor Department data released Thursday, as the economic effects of the coronavirus pandemic continue to batter the economy.
The seasonally adjusted figures bring the total number of newly unemployed Americans since the start of the pandemic to roughly 36.5 million. The unadjusted weekly figure, which some economists say is more accurate given the scale of the pandemic, was 2.6 million.
The number does mark the lowest weekly reading since the crisis began, a fact some economists point to as a glimmer of good news in an otherwise dismal report.
The highest reading before coronavirus effects started showing in March was 695,000, well below the multimillion figures that have cropped up weekly for the past couple of months.
The Labor Department report also noted that in the week ending April 25, 3.4 million people applied for Pandemic Unemployment Assistance, the expanded benefits program Congress approved in March’s CARES Act that offers benefits to gig economy workers, the self-employed and freelancers, who are typically not eligible.
The official unemployment rate reported for April was 14.7 percent, higher than the worst reading in the Great Recession in 2009, which came to 10 percent. But the survey on which the data was based is nearly a month old at this point. Economists say the real rate is likely as high as 20 percent at this point.
The Treasury Department said it spent $48 billion on unemployment insurance in April alone.
Goldman Sachs forecast that the unemployment rate would peak at 25 percent, near the highs of the Great Depression, and that annualized gross domestic product would shrink an astonishing 39 percent in the second quarter.
The report comes as some states have begun a gradual process of reopening their economies.
Moves toward easing social distancing closures have proved controversial, with critics warning that hasty moves to ease lockdowns could lead to new outbreaks and ultimately cause deeper economic damage.
“There is a real risk that you will trigger an outbreak,” Anthony Fauci, the director of the National Institute of Allergy and Infectious Diseases, said on Tuesday.
Andrew Stettner, a senior fellow at The Century Foundation, said that more needed to be done to ensure safe work environments.
“The biggest challenge now is the lack of clear safety guidelines and protective personal equipment (PPE) to give workers the chance to go back to work without fear,” he noted in an analysis of the latest data.
“Unfortunately, many states are forcing workers to choose between uncertain and unsafe work conditions or risk losing their unemployment lifeline,” he added.
Updated at 9:05 a.m.