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Another 5.2 million workers filed for their first week of unemployment benefits last week, according to the US Department of Labor, bringing the total number of Americans who have filed initial jobless claims to around 22 million, or roughly 13.5% of the labor force, since March 14.
Overall, the last four weeks have marked the largest and most dramatic rise in claims on record since the Labor Department started tracking the data in 1967.
Other jobs crises have played out far more slowly. In the Great Recession, for example, it took two years for 8.6 million Americans to lose their jobs.
This time, mass layoffs and furloughs came suddenly as states enacted lockdowns of all but essential businesses to slow the spread of the coronavirus pandemic.
“April is bound to be truly shocking,” Brian Coulton, chief economist at Fitch Ratings wrote in a research note. He estimates the unemployment rate could rise to about 15% in April — a new high post-World War II.
During the coronavirus pandemic, layoffs initially hit service jobs the hardest. Workers at retailers, restaurants and hotels, for example, were among the first to lose their jobs. Now, as a deep economic downturn takes hold, job losses could start to hit white collar office jobs, too.
“As shutdowns continue, job losses will likely extend into other areas of the labor market, such as business and professional services where firms may begin to see lower revenues from a second order pull back in demand,” Robard Williams, a senior vice president for Moody’s Investors Service noted.
A shock to America’s unemployment system
Initial claims represent first-time applications for unemployment benefits, and not all of those applications result in people receiving benefits. As of the week ending April 4, about 12 million Americans were receiving benefits, according to the Department of Labor. That number is also at an all-time high. In contrast, at the height of the Great Recession, no more than 6.5 million workers were on unemployment benefits at any given time.
Soon, some states are also expected to run low on funding for unemployment benefits.
This is a developing story. It will be updated
-— CNN’s Tami Luhby and CNN Business’ Clare Duffy contributed to this report.
