US jobless claims surge to record 3.3m

More than 3 million people applied for unemployment benefits last week in the United States, a record that provides the first national snapshot of the impact of the coronavirus shutdown on businesses, cities and states. whole.

According to data released Thursday by the Ministry of Labor, claims reached 3.3 million for the week ending Saturday, up from 282,000 the previous week. The data overshadowed expectations, showing the staggering scale of job losses in the first full week of demands since parts of the country began to restrict public gatherings and, in some cases, order residents to stay home.

As states began to publish their own claims data before the Ministry of Labor announced, forecasts ranged from a Bloomberg consensus of 1.7 million claims to an estimate of 3.4 million claims by the Economic Policy Institute.

This is by far the largest week-on-week increase in jobless claims since the department started publishing cases in 1967. Previous week-long peaks had occurred in October 1982, with 695,000 claims, and in March 2009, with 665,000.

Pennsylvania reported the highest number of requests with 378,900 requests, while requests for California jumped to 186,809. New York State, which was the epicenter of the epidemic in the United States, reported 80,300 requests.

Over the past week, new requests for unemployment assistance have overwhelmed the state systems that administer them, causing websites to crash and overworking labor agencies struggling to process claims.

US equity futures indicated a 2% drop in the S&P 500 at the start of trading after the data was released. US Treasuries remained firm with the yield on the 10-year benchmark remaining stable at 0.78%. The yield on the two-year note, more sensitive to policies, hovered at 0.3%.

“It’s just disastrous on many levels,” said Torsten Slok, chief economist at Deutsche Bank Securities. The claims data show that cost-cutting firms are already having serious consequences, both for growth and for the job market, he added.

“It is an impossible figure to understand. We have just suppressed a year and a half of employment growth, ”said Martha Gimbel, labor economist at Schmidt Futures.

“The most important thing to remember is that this is an undercoverage of sufferers,” said Gimbel. She pointed out that the claims data only reflect those who were able to claim unemployment insurance benefits. Others may not be eligible, have had reduced hours instead of being laid off, or have been unable to enter state systems when the websites of employment agencies have crashed.

“We will not have a full picture of unemployment before the start of May, but this report is likely to be devastating,” she said.

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