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Red sign hanging at the glass door of a shop says, "Closed due to coronavirus."

Red sign hanging at the glass door of a shop says, "Closed due to coronavirus." (Photo: Getty Images)

US Unemployment Claims During Coronavirus Pandemic Soar to 'Truly Shocking' 16.8 Million

"The scale of the economic catastrophe is breathtaking."

Jessica Corbett

In a development described as "absolutely staggering," the U.S. Department of Labor announced Thursday that 6.6 million Americans filed unemployment claims last week, bringing the three-week total to roughly 16.8 million—meaning about 10% of the nation's workforce has become jobless during the ongoing coronavirus pandemic.

"Unprecedented. Unheard of. Uncharted territory. These are phrases I use all the time now but they are deeply inadequate for describing what's going on."
—Heidi Shierholz, EPI

"The labor market has been upended," Economic Policy Institute (EPI) senior economists Elise Gould and Heidi Shierholz said in a statement responding to the DOL's new data (pdf) for the country's employment conditions through April 4.

Shierholz, the think tank's director of policy, also addressed the data in series of tweets Thursday, noting that the millions of unemployment insurance (UI) claims filed in the last three weeks "is a mind-boggling 2,500% increase over the pre-virus period."

"Unprecedented. Unheard of. Uncharted territory. These are phrases I use all the time now but they are deeply inadequate for describing what's going on," she wrote. "16.8 MILLION workers have already applied for unemployment insurance and we are still in the middle of this."

While there seems to be a general consensus that the number of Americans who have filed for unemployment benefits over the past few weeks is "truly shocking," Gould and Shierholz explained that the DOL figures underrepresent how many people nationwide are currently jobless because of the public health crisis.

"The UI claims figures in recent weeks don't include people who aren't eligible for regular unemployment insurance but are nevertheless out of work due to the virus—people like independent contractors, those who had to quit work to care for a child whose school closed, and those who don't have long enough work histories," they said. "In other words, coronavirus job losses are greater than what today's numbers show."

Gould and Shierholz warned that millions more Americans are expected to lose their jobs as the crisis continues, a situation that also has implications for healthcare—in the middle of a virus outbreak that has infected over 432,500 people and killed at least 14,830 nationwide.

Based on GDP forecasts, we project that near-term job losses could easily exceed 20 million, even with relief measures already in place—and that estimate will increase in coming weeks if GDP forecasts deteriorate. And workers aren't just losing their jobs. Given that our healthcare system ties health insurance to work, millions of workers likely lost their employer-provided health insurance at the end of March, and millions more will follow this month and in coming months.

A study published Tuesday in The Annals of Internal Medicine, the official journal of the American College of Physicians, found that layoffs from the pandemic have already caused more than 1.5 million people in the United States to lose their employer-provided health insurance and projected another 5.7 million Americans could lose coverage by the end of June.

The latest UI figures provoked fresh calls from progressives for Congress to pursue policies that would provide everyone in the country with immediate relief from the coronavirus outbreak—including cash transfers of $2,000 per month and the suspension of rent and mortgage payments—as well as long-term health and financial security, such as Medicare for All, a federal jobs guarantee, and a Green New Deal.

"Given the extraordinary upending of the labor market we've already experienced and the fact that the situation is still deteriorating," Gould and Shierholz declared, "federal policymakers absolutely need to do more."

According to the EPI economists:

The next relief and recovery package should provide aid to state and local governments, extend unemployment insurance benefits, and provide better protections for workers. They should also incentivize employers to keep workers on payroll so that as few families as possible face the often-lasting economic consequences of job loss, and so that more businesses will be able to quickly reopen when the lockdown is over. And importantly, we cannot turn off federal government relief too early. At this point it appears that even under the best-case scenario—a rapid bounce-back in the second half of the year—the unemployment rate will still be close to 10% in the fourth quarter of this year.

Gould and Shierholz were far from alone in warning that the country's current high unemployment rate could last for several months, if not longer.

The Associated Press reported Thursday that "the U.S. unemployment rate could hit 15%—a number last seen at the tail end of the Depression—when the figures for April come out."

Vox co-founder and senior correspondent Matthew Yglesias tweeted that the nation is now in "worst unemployment since the Great Depression" territory. In a separate tweet, he added that "the scale of the economic catastrophe is breathtaking."

On a global scale, the United Nations' International Labor Organization released a report Tuesday which found that the COVID-19 outbreak could cause working hours worldwide to decline by 6.7% in the second quarter of 2020, the equivalent of 195 million full-time jobs.

The U.N. agency's report emphasized that an estimated 1.25 billion workers in hard-hit sectors such as retail trade, accommodation and food services, and manufacturing "are facing a drastic and devastating reduction in working hours, wage cuts, and layoffs."


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