A 3,000% jump in jobless claims has devastated the US job market

From today’s CNN Online:

The last three weeks have marked one of the most devastating periods in history for the American job market, as first-time claims for unemployment benefits have surged more than 3,000% since early March. Businesses continue to lay off and furlough workers amid the coronavirus outbreak.6.6 million US workers filed for their first week of unemployment benefits in the week ending March 28, according to the Department of Labor — a new historic high.

That was far greater than economists had expected, and more than 3,000% the pre-pandemic levels. Unemployment claims at this level suggest a severe job market decline hardly any American alive has ever seen in their lifetimes.

Economists characterized the increase as “monstrous,” “stunningly awful,” and “a portrait of disaster.”Including the prior week’s 3.3 million initial claims, Americans have filed nearly 10 million jobless claims in the last two weeks alone. That corresponds to roughly 6% of America’s 165 million strong work force, which in turn implies a 9.5% unemployment rate, according to Citi economist Andrew Hollenhorst.

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Federal government is weighing an infrastructure push to create jobs

From today’s New York Times:

Fears are growing that the global downturn could be far more punishing and long lasting than initially feared — potentially enduring into next year, and even beyond — as governments intensify restrictions on business to halt the spread of the pandemic, and fear of the virus impedes consumer-led economic growth.

“This is already shaping up as the deepest dive on record for the global economy for over 100 years,” said Kenneth S. Rogoff, a Harvard economist and co-author of “This Time Is Different: Eight Centuries of Financial Folly,” a history of financial crises. “Everything depends on how long it lasts, but if this goes on for a long time, it’s certainly going to be the mother of all financial crises.”

Stocks on Wall Street tumbled, with the S&P 500 closing down more than 4 4 percent, bringing its decline over two days to 6 percent, as investors braced for worsening economic conditions ahead.

The economic readings continue to worsen as well. On Wednesday, surveys of manufacturing and factory activity in the United States, Europe and Japan showed activity slowing to levels not seen in a decade or more. In the United States, factory orders and employment measures fell to their lowest since 2009, the Institute for Supply Management said.

In Washington, there was growing concern that the $2 trillion stimulus package enacted last week could be insufficient. Democrats and Republicans in Congress, as well as President Trump, are increasingly looking toward enacting a huge new infrastructure plan that could create thousands of jobs.

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More than half of American jobs are at risk because of coronavirus

From CNN News Online:

A week ago, Darrin Dixon wasn’t all that concerned about the coronavirus. Now he’s losing sleep over the prospect that the virus could cost him his food truck and catering business, which provides three jobs, including his own. Sales at Dixon’s food truck, KC Cajun, plunged this week as businesses in downtown Kansas City, Missouri, where he’s based, have shifted to working from home. His catering business is having cancellations like he’s never seen before.

“I know I’m stressed. I’ve had sleepless night. It’s just scary because we don’t know what we’re going to do,” said Dixon. His situation is a harbinger of the problems facing the US economy from the coronavirus, which could be far deeper and more widespread than they initially appeared. And because it will hit small businesses like Dixon’s particularly hard, it could take years for the economy to fully recover — even after the coronavirus crisis is long over. It’s not just jobs at airlineshotelsamusement parks and sporting events that are at risk. It’s the food trucks that serve office workers or school students who are now staying home. It’s the dry cleaners who clean the dress clothes that will not be worn as workers stay away from their offices. It’s hair stylists, dog walkers, babysitters, restaurant workers and others who provide services that people no longer need or can’t afford.

More than half of US jobs at risk

Nearly 80 million jobs in the US economy are at high or moderate risk today, according to analysis in the last week from Moody’s Analytics. That’s more than half of the 153 million jobs in the economy overall. That doesn’t mean that all those jobs will be lost. But it’s probable that as many as 10 million of those workers could see some impact to their paychecks — either layoffs, furloughs, fewer hours or wage cuts, said Mark Zandi, chief economist at Moody’s Analytics.

Of those 80 million jobs, Moody’s Analytics projects that 27 million are at high risk due to the virus, primarily in transportation and travel, leisure and hospitality, temporary help services and oil drilling and extraction. Maybe 20% of those workers, comprising about 5 million jobs, will be affected, Zandi said. The other 52 million jobs are judged to face “moderate risk.” They are in areas such as retail, manufacturing, construction and education. Some 5 million of those workers are could be unemployed or underemployed.

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