New US unemployment claimants top 1m for 13th week in a row

‘It’s a sustained haemorrhaging of jobs unlike anything we’ve seen before’

Brad Ruoho, owner of  Legacy Toys,  in his Mall of America store in Bloomington, Minnesota. The US economy continues to bleed fresh jobs. Photograph: AFP via Getty

Brad Ruoho, owner of Legacy Toys, in his Mall of America store in Bloomington, Minnesota. The US economy continues to bleed fresh jobs. Photograph: AFP via Getty

 

Another 1.5 million people applied for US state unemployment benefits last week, the US Labor Department said on Thursday, while 760,000 more filed new claims for Pandemic Unemployment Assistance, a federal emergency program me that extends benefits to self-employed workers, independent contractors and others who don’t qualify for standard benefits.

It was the 13th straight week that filings topped 1 million. Until the present crisis, the most new claims in a single week had been 695,000, in 1982.

“It’s still more than twice the worst week of the Great Recession,” said Heidi Shierholz, director of policy at the Economic Policy Institute, a progressive think tank. “It’s a sustained haemorrhaging of jobs unlike anything we’ve seen before.”

The pace of layoffs has slowed steadily since early April, after unemployment filings topped 6.5 million for two straight weeks. And the total number of people receiving benefits has been edging down as businesses reopen and recall furloughed workers.

Economists said the current layoffs, though smaller than the wave in March and early April, were in some ways more worrying because they suggested that the crisis was reaching deeper into the economy even as lockdowns eased. “What you’re seeing right now is economic scarring starting to happen,” said Martha Gimbel, an economist and a labour market expert at Schmidt Futures, a philanthropic initiative.

“Layoffs that happened at the beginning of this likely were intended as temporary. But if you’re laying off people now, that’s probably a long-term business decision.”

Backlogs

Not all of the US unemployment claims reported on Thursday necessarily reflect new layoffs. Some states are working through backlogs of claims filed earlier in the crisis; in other cases, people filing under multiple programs may be double-counted.

But economists say there is little doubt that US layoffs remain elevated three months into the crisis. And they warn that job losses could worsen if government support that has helped prop up the economy is allowed to lapse too soon. – New York Times Service