The magnitude of the economic devastation being wrought by the coronavirus pandemic was laid bare on Thursday when the U.S. government reported an unprecedented surge in the number of people seeking jobless benefits.
A total of
“This shows the severity of the downturn, and the speed of it,” said
Even with the surge, the S&P 500 extended its advance, heading for its
Claims increased in all 50 states and the District of Columbia, with nine states reporting jumps of at least 100,000 from the prior week, unadjusted state data showed:
- Pennsylvania reported the biggest number of claims, with an estimated
- California claims rose by 129,200 to
- In New York state, where approximately half of all known coronavirus cases in the U.S. are located, claims rose by 66,000 to
- Ohio claims rose to an estimated
- Illinois claims rose to
- Florida claims rose to
- Michigan claims jumped to
“This morning’s data leaves no doubt that the economy is currently in a recession,” said
The surge reflects
What Bloomberg’s Economists Say
“The deterioration in claims to date already implies an unemployment rate approaching 5.5% in April, and there is no reason to believe this is the peak. The volume of applications overwhelming state administrative offices suggests additional million-plus weeks for initial claims may lay ahead.”
U.S. lawmakers are aiming to boost benefits for those laid off. As part of a $2 trillion stimulus package waiting to be approved by the House of Representatives, unemployment insurance would be extended and expanded.
The sharp rise in claims signals the
The sudden stop of the nation’s economy paired with a consumer retrenchment have
In St. Petersburg, Florida, getting benefits has already stymied sportswriter Jim Holliman in the first days of his unemployment. Holliman, 47, had been freelancing for a unit of CBS Interactive focused on sports gambling in recent months, and he hoped to turn it into a full-time gig. He’s been in and out of jobs since his longtime employer, the Tampa Tribune newspaper, shut down in 2016.
Coverage opportunities dried up this month as major sports leagues and arenas closed. By late last week, his employer notified him it barely had enough work for full-time reporters, Holliman said Wednesday. “I was getting close to 40 hours a week freelancing and hoping to turn it into a full time job, and then obviously the sports world hit a brick wall,” he said.
- A separate report Thursday from the Commerce Department showed the U.S. merchandise trade deficit narrowed in February to
$59.9 billion, the smallest since September 2016, as exports increased and imports declined.
- The pickup in shipments to overseas customers reflected more U.S. sales of motor vehicles and industrial supplies, such as petroleum products. The value of
importswas the smallest since September 2017 as companies purchased less capital equipment, industrial supplies and consumer goods.
- Gross domestic product climbed at an unrevised
2.1%annualized pace in the final three months of 2019, ahead of the virus disruptions that will likely see the economy contract in the first and second quarters.
- The Federal Reserve Bank of Kansas City’s manufacturing index fell to
minus 17in March, its lowest reading since 2009, as the outbreak fueled concerns of shutdowns and future demand.
(Adds market reaction and regional manufacturing data in last bullet)
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