Over 3.3 million Americans filed for unemployment in the week that ended March 21st and that was an all-time record high, but literally twice as many people filed for unemployment last week.
The Labor Department recorded over 6.6 million additional claims for unemployment last week; far above the worst projections.
Initial claims for state unemployment benefits surged 3.341 million to a seasonally adjusted 6.648 million for the week ended March 28, the government said. Data for the prior week was revised to show 24,000 more applications received than previously reported, lifting the number to 3.307 million.
Economists polled by Reuters had forecast claims would jump to 3.50 million in the latest week, though estimates were as high as 5.25 million.
These numbers are not going to be reflected in Friday's report for the month of March which is only going to show unemployment increasing to 3.8 percent.
Even though the upcoming report won't reflect what has actually happened in the past two weeks, I think we can expect to see Trump point a tiny finger at it and say things aren't so bad after all.
“A rough look at the most affected industries suggests a potential payroll job loss of over 16 million jobs,” said David Kelly, chief global strategist at JPMorgan Asset Management in New York. “The loss would be enough to boost the unemployment rate from roughly 3.5% to 12.5%, which would be its highest rate since the Great Depression.”
The $2 trillion aid package recently passed by Congress is going to help mitigate the impact of this but, long-term, I have concerns.
A significant number of people have been merely furloughed which means they could be called back when our collective isolation is over, but we don't know when it will be safe to do that and the longer this continues the more likely it is that many businesses will never reopen.
I know I've said this before, but it feels even more well-founded with each passing week. The notion that the economy will sharply rebound in the third and fourth quarter of this year seems like a fantasy. Perhaps the economy will sharply recover in the third and fourth quarter of 2021.
I'm sure the economists at Goldman Sachs know better than I do but, at the same time, how could anyone possibly believe the economy will grow by 8 percent in the third quarter?
Things did not have to be this bad and they wouldn't be if the Trump regime had done anything to contain the virus. It's the first week of April and some Republican-controlled states still haven't issued stay-at-home orders and the longer they wait to do that the longer it will take to recover. Waiting to isolate means the peak of infections has been pushed further down the road into the third quarter. Economic paralysis has been extended by the failure to act.