Yesterday, the Labor Department reported that another 4.4 million people filed initial unemployment claims last week, bringing the five-week total to more than 26 million. Nearly one in six American workers or about 16 percent of the workforce has lost a job in recent weeks. To put this in perspective, during the Great Depression of the 1930s, the unemployment rate varied from 15 to 25 percent.
As reported by The New York Times: “At all levels, these are eye-watering numbers,” Torsten Slok, chief international economist at Deutsche Bank Securities, said. Delays in delivering benefits, though, are as troubling as the sheer magnitude of the figures, he said. Such problems not only create immediate hardships, but also affect the shape of the recovery when the pandemic eases.
Laid-off workers need money quickly so that they can continue to pay rent and credit card bills and buy groceries. If they can’t, Mr. Slok said, the hole that the larger economy has fallen into “gets deeper and deeper, and more difficult to crawl out of.”
Hours after the Labor Department report, the House passed a $484 billion coronavirus relief package to replenish a depleted small-business loan program and fund hospitals and testing. The Senate approved the bill earlier this week.
Even as Congress continues to provide aid, distribution has remained challenging. According to the Labor Department, only 10 states have started making payments under the federal Pandemic Unemployment Assistance program, which extends coverage to freelancers, self-employed workers and part-timers. Most states have not even completed the system needed to start the process.”
There are few signs that the coronavirus pandemic situation is getting appreciably better.