A further 3.8 million Americans filed for unemployment benefits last week, according to the US Labor Department.
Although this represents a fall from the previous week’s figure of 4.4 million, the latest data brings the total number of initial jobless claims in the world’s largest economy to 30.3 million in the past six weeks.
With one in five Americans who had a job in February now unemployed, the sheer scale of the economic devastation triggered by the Covid-19 pandemic is becoming clearer.
These latest statistics follow yesterday’s revelation that in the first quarter of 2020 the US economy suffered its worst contraction since the global financial crisis, with GDP down 4.8 per cent.
With a 30 per cent drop anticipated by some senior White House advisers in the next quarter, Goldman Sachs has predicted that the US unemployment rate will rise to 15 per cent by mid-year. Such a figure would surpass the post-war peak of 10.8 per cent witnessed in 1982 and only be dwarfed by 1933’s historic 24.9 per cent.
According to the official statistics, the United States is the nation worst affected by the novel coronavirus outbreak, with over one million confirmed cases and almost 60,500 deaths. The widespread lockdowns imposed to limit the virus’s spread have severely affected the US economy, with small and medium businesses suffering the most – despite record-breaking government stimulus packages and unprecedented central bank intervention.
The chairman of the Federal Reserve, Jerome Powell, recently stated:
While another fall in initial jobless claims is anticipated for this week, with widespread reports of backlogged state bureaucracies, the number of claimants is still expected to be in the millions.