Trends: Jobless Claims Reach 6.6 Million

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The COVID-19 pandemic rages on, and the damage being done to the U.S. economy is only getting worse.

This story by Heidi Chung originally appeared in Yahoo! Finance.

The U.S. Labor Department released fresh data on Thursday morning that showed the effect of the novel coronavirus on employment in the U.S. The number of Americans filing for unemployment benefits spiked to a record-breaking 6.648 million for the week ending March 28. Consensus expectations were for 3.76 million claims. The prior week’s figure was revised higher to 3.307 million claims from 3.283 million. Before the week ending March 21, the previous record was 695,000 claims filed the week ended October 2, 1982.

“The deterioration of the labor market in the past two weeks almost defies belief,” Nick Bunker, Indeed Hiring Lab’s director of economic research, wrote in an email Thursday. “Since March 14, approximately 3.8 percent of the working age population has filed for unemployment. For context, during the Great Recession, the share of the population dropped 4.6 percentage points from December 2007 to December 2009. That took two years. The labor market is in a historic freefall.”

Though consensus estimates were for 3.7 million initial jobless claims for the week ended March 28, the range of estimates on Wall Street were wide, but the major firms expect the number to be in the millions. On the high end, Goldman Sachs expected 6 million claims for the week. Not far behind were Bank of America and Pantheon Macroeconomics expecting 5.5 million claims, while on the lower end, JPMorgan Asset Management predicted 2 million claims.

In addition, the CARES act that was signed into effect last week expanded unemployment privileges to previously ineligible people such as those who are self-employed and independent contractors. As a result, the number of filers could meaningfully increase.


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