Please ensure Javascript is enabled for purposes of website accessibility
Virus Sends Jobless Claims up for First Time Since March
gvw_ap_news
By Associated Press
Published 5 years ago on
July 23, 2020

Share

WASHINGTON — The viral pandemic’s resurgence caused the number of Americans seeking unemployment benefits to rise last week for the first time in nearly four months, evidence of the deepening economic pain the outbreak is causing.
The increase in weekly jobless claims to 1.4 million served to underscore the outsize role the unemployment insurance system is playing among the nation’s safety net programs — just when a $600 weekly federal aid payment for the jobless is set to expire at the end of this week.
Last week’s pace of unemployment applications — the 18th straight time it’s topped 1 million — was up from 1.3 million the previous week. Before the pandemic, applications had never exceeded 700,000. An additional 975,000 applied last week for jobless aid under a separate program that has made self-employed and gig workers eligible for the first time.
The weakening of the labor market has raised fears that the economy will shed jobs again in July, after two sharp hiring gains in May and June, and derail prospects for a recovery from the recession.
“The labor market remains in a precarious place as COVID-19 cases surge in some parts of the country and fresh lockdown measures are adopted in response,” said Nancy Vanden Houten, lead economist at Oxford Economics, a consulting firm.
In contrast to the U.S., the outlook has brightened for some other major economies. Europe is forecast to rebound next year after having managed to shrink its coronavirus caseload. Unemployment in the 19 countries that use the euro has remained contained, reflecting aggressive government efforts to keep workers on payrolls.

The Painfully High Number of Layoffs Reflects a Pandemic That’s Causing Both Confirmed Infections and Deaths

And China has become the first major economy to grow since the start of the pandemic. Economists say China will likely recover relatively fast because of the Communist Party’s move to impose early and intensive anti-disease measures.
The U.S. government also said Thursday that the total number of people receiving jobless benefits fell 1.1 million to 16.2 million. That was a hopeful sign that even as layoffs remain persistently high, some companies are recalling workers. Yet that figure is still roughly 10 times what it was before the pandemic.
The painfully high number of layoffs reflects a pandemic that’s causing both confirmed infections and deaths to rise nationally. Laboratories are buckling under a surge of coronavirus tests, creating processing delays that are undercutting the pandemic response. With the U.S. tally of confirmed infections nearing 4 million and deaths above 143,000, some workers are being kept off the job while awaiting test results. Analysts say the economy can’t improve until authorities can control the spread of the virus, a need that is complicating the reopening of businesses and schools.
Last week, applications for unemployment benefits declined in many states that have been hard hit by the virus, including Texas, Florida, Georgia and Arizona. Jobless claims rose in other states that are also seeing increases, however, including Louisiana, California, and Tennessee. The resurgence of confirmed virus cases has forced some businesses to close a second time or to impose tighter restrictions on customers in response to state mandates. The resulting pullback in business activity has hindered job growth and likely forced additional layoffs.

Special events workers who were forced out of work because of the COVID-19 pandemic marched Tuesday, July 21, 2020, in Salt Lake City. Marchers organized by Utah Live Event Industry Association aimed to draw attention and legislative support to the people and businesses who put on concerts, theater, sports, and other live events which mostly have gone dark since the COVID-19 pandemic hit in March. They’re called it a “peaceful walk for work.” The silent parade showcased families struggling to make ends meet since events have been canceled, with no end to the restrictions in sight. (AP Photo/Rick Bowmer)

Members of Congress Are Negotiating Another Aid Package

The federal government’s $600 weekly benefit for laid-off workers — which is in addition to whatever jobless aid a state provides — is the last major source of economic help from the $2 trillion relief package that Congress approved in March. A small business lending program and one-time $1,200 payment have largely run their course.
Members of Congress are negotiating another aid package that might extend the $600 benefit, though likely at a lower level. Because of the $600 weekly federal benefit, roughly two-thirds of the unemployed are receiving more in aid than they earned at their former jobs, research has shown — a finding that’s led Republicans to argue that it is discouraging people from returning to work.
Yet the additional money has also been a key source of support for people who lost jobs that no longer exist or who fear being infected by the virus if they return to work.
The enhanced aid “is important to a lot of households, especially to my household, that cannot go back to work,” said Cindy Moffett, who used to work in the trade show industry, which has seen business dry up entirely since the pandemic began. Without tourists, she has no job to return to.
Analysts say it’s unlikely an agreement will be reached before the end of this month, and could take until mid-August. It would then take additional time for state unemployment agencies to distribute any extra benefit that is approved.
Such a disruption would likely “result in a slower rebound in overall economic activity,” said Joe Brusuealas, chief economist at RSM, a tax advisory firm.
[covid-19-tracker]

A Growing Number of States Have Announced New or Broadened Mask Requirements

Unemployment aid accounted for 6% of all U.S. income in May, a greater share than even Social Security. Economists say it’s one reason why retail spending rebounded as quickly as it did in May and June, helping fuel a modest economic rebound. If the full $600 were extended, it would boost consumer spending enough to generate roughly 1 million jobs by the end of this year, Oxford Economics estimates.
The end of the added benefit coincides with the expiration of a federal moratorium on evictions on Saturday. That moratorium bars evictions of renters who live in federally subsidized housing, and without it, about 22 million people are at risk of losing their homes.
Desperate to stop the spread of the virus and its resulting economic impact, a growing number of states have announced new or broadened mask requirements. A new survey from The Associated Press-NORC Center for Public Affairs Research finds three out of four Americans, including a majority of Republicans, favor requiring people to wear face coverings while outside their homes.
Real-time measures of the economy suggest that companies are pulling back on hiring and that more small businesses are closing permanently. Credit card spending has been stuck at about 10% below year-ago levels for nearly a month, according to JPMorgan Chase, after having risen steadily from mid-April to mid-June.

Many Unemployed Say They Fear That a Slow and Prolonged Recovery Would Be Hard to Survive Without the $600 Weekly Aid

Data from the consumer-review website Yelp, which tracks millions of small businesses, shows that more such companies are permanently shutting down. Nearly 73,000 small businesses have closed for good since the pandemic intensified in March, up 28% from mid-June.
“Every time a business closes, that makes the recovery longer and harder, so that worries me,” said Ernie Tedeschi, an economist at the investment bank Evercore ISI.
Many of the unemployed say they fear that a slow and prolonged recovery would be hard to survive without the $600 weekly aid from the federal government. If that payment were eliminated, total unemployment benefits would shrink by one-half to two-thirds, depending on a recipient’s state.
Melissa Bennett has been using the federal jobless benefit to help pay her $1,900 monthly health insurance bill, which she’s paid on her own since losing her employer-sponsored plan in June when she was laid off from her job at a vacation time-share rental in Myrtle Beach, South Carolina, which has become a COVID-19 hot spot.
Without the $600, her unemployment benefit will fall to just $200 a week, and she’ll have to decide whether to pay her mortgage or her utilities first.

RELATED TOPICS:

DON'T MISS

First California EV Mandates Hit Automakers This Year. Most Are Not Even Close

DON'T MISS

Newsom Wants to Bypass Trump Tariffs With Direct CA Trade Deals

DON'T MISS

Markets Plunge With S&P 500 Down 6% and Dow Down 2,200 After China Retaliates

DON'T MISS

Fresno Police Searching for Missing 12-Year-Old Girl

DON'T MISS

Madera Community College Unveils New Multicultural and Veterans Center

DON'T MISS

Fusion Energy Race Is On. Two Local Lawmakers Want California to Lead the Way

DON'T MISS

Saturday’s Spring Fest to Showcase Free, Low-Cost Activities for Fresno Kids

DON'T MISS

LA County Reaches $4 Billion Agreement to Settle Sexual Abuse Claims at Juvenile Facilities

DON'T MISS

Fresno Man Sentenced to 14 Years in Prison for Deadly Marijuana DUI Crash

DON'T MISS

Judge Says US Must Return Maryland Man Who Was Mistakenly Deported to El Salvador Prison

DON'T MISS

These Fresno First-Graders Are Topping Their Peers in Reading

UP NEXT

USC’s JuJu Watkins Named AP Player of the Year After Historic Sophomore Season

UP NEXT

Dodgers’ Freddie Freeman Lands on Injured List Following Fall in His Shower at Home

UP NEXT

How Trump’s Latest Tariffs Could Affect Your Wallet

UP NEXT

Curry Scores 37 Points and Warriors Beat Lakers in a Potential First-Round Playoff Preview

UP NEXT

Measles Spreads to Central Texas; 5 States Have Active Outbreaks

UP NEXT

Startup Offers Controversial Microplastic Blood Cleansing Treatment

UP NEXT

Pence Will Receive the Profile in Courage Award From the JFK Library for His Actions on Jan. 6

UP NEXT

Flores Homers, Matos and Wade Also Go Deep to Help Giants Cap Sweep of Astros

UP NEXT

Trump Proposes Tax Deduction for Auto Loan Interest on US-Made Cars

UP NEXT

Western US Sees Sharp Increase in Extreme Weather Impact

Madera Community College Unveils New Multicultural and Veterans Center

6 hours ago

Fusion Energy Race Is On. Two Local Lawmakers Want California to Lead the Way

6 hours ago

Saturday’s Spring Fest to Showcase Free, Low-Cost Activities for Fresno Kids

7 hours ago

LA County Reaches $4 Billion Agreement to Settle Sexual Abuse Claims at Juvenile Facilities

7 hours ago

Fresno Man Sentenced to 14 Years in Prison for Deadly Marijuana DUI Crash

7 hours ago

Judge Says US Must Return Maryland Man Who Was Mistakenly Deported to El Salvador Prison

7 hours ago

These Fresno First-Graders Are Topping Their Peers in Reading

9 hours ago

Fresno Burial Ceremony to Honor Five Abandoned Babies Set for Saturday

9 hours ago

Visalia Man Arrested for Soliciting Sex From Minor in Kingsburg

9 hours ago

Camalah Saleh Cruises to Win in Stormy Fresno State Student Elections

10 hours ago

Newsom Wants to Bypass Trump Tariffs With Direct CA Trade Deals

Gov. Gavin Newsom on Friday asked exporting countries worldwide to spare California their retaliatory tariffs, saying he plans to pursue dir...

5 hours ago

5 hours ago

Newsom Wants to Bypass Trump Tariffs With Direct CA Trade Deals

Specialist Anthony Matesic works on the floor of the New York Stock Exchange, Friday, April 4, 2025. (AP/Richard Drew)
6 hours ago

Markets Plunge With S&P 500 Down 6% and Dow Down 2,200 After China Retaliates

Fresno police are searching for Unique Hernandez, 12, last seen on Friday, April 4, 2025, near Inyo Street and Maple Avenue, wearing all black clothing and carrying a black backpack. (Fresno PD)
6 hours ago

Fresno Police Searching for Missing 12-Year-Old Girl

6 hours ago

Madera Community College Unveils New Multicultural and Veterans Center

6 hours ago

Fusion Energy Race Is On. Two Local Lawmakers Want California to Lead the Way

7 hours ago

Saturday’s Spring Fest to Showcase Free, Low-Cost Activities for Fresno Kids

7 hours ago

LA County Reaches $4 Billion Agreement to Settle Sexual Abuse Claims at Juvenile Facilities

Antonio de Jesus Orozco Montes Deoca, 30, was sentenced on Friday, March 4, 2025, to 14 years and 8 months in prison for a deadly marijuana DUI crash in 2022 that killed one woman and injured four others. (GV Wire Composite)
7 hours ago

Fresno Man Sentenced to 14 Years in Prison for Deadly Marijuana DUI Crash

Help continue the work that gets you the news that matters most.

Search

Send this to a friend