In March, the official unemployment rate in the US was 4.4%, close to a 50-year low, but economists predict it could now be as high as 20%, a level unseen since the 1930s Great Depression.
A further 3.2 million Americans sought unemployment benefits last week as the coronavirus pandemic continues to take its toll on the US economy. This brings the total number of jobs lost to 33.3 million since lockdown measures began mid-March.
The number of new claims reported each week by the Department of Labour has subsided since hitting a peak of 6.9 million in March.
The amount of people collecting benefits has continued to rise, despite recent moves to start re-opening in some parts of the country.
As reported in CNBC, the jump in continuing claims “is a little disappointing since it suggests few people are being recalled to work,” said Paul Ashworth, chief U.S. economist at Capital Economics.
Companies like Uber, Airbnb and Lyft are among the firms that have laid off staff in recent weeks, as lockdown has had a huge impact on travel.
Other sectors that have been hit hard include the service industry, administrative services and certain medical practices.
According to CNN, in response to the crisis, the government broadened the definition of who is covered by unemployment benefits to include contractors, the self-employed and workers in the gig economy.
The Department of Labour said that as of last week, all 50 states were paying out those extra benefits — but the agency has yet to release detailed breakdowns of how many claims have come in through that program in each state.
Economists are hoping as businesses gradually reopen the situation will improve.
Moody’s Investors Service has predicted that the unemployment rate could fall back to 7% by the end of the year, but that forecast depends on the virus. The longer the shutdown persists, the harder it will be for the economy to rebound.
Sourse: sputniknews.com
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