Nearly 3.8 million more Americans filed for unemployment benefits last week as the coronavirus pandemic continued to trigger a historic economic downturn, bringing the total number of workers laid off since the outbreak began to more than 30 million.
With more employers cutting payrolls to save money, economists have forecast that the unemployment rate for April could go as high as 20 per cent. That would be the highest rate since it reached 25 per cent during the Great Depression.
Meanwhile, the unemployment rates weren't the only recent economic figures providing a grim outlook on the days ahead.
This week, the government estimated that the economy shrank at a 4.8 per cent annual rate in the first three months of this year, the sharpest quarterly drop since the 2008 financial crisis. Yet the picture is likely to grow far worse: The economy is expected to contract in the April-June quarter by as much as 40 per cent at an annual rate. No previous quarter has been anywhere near as weak since the government began keeping such records after World War II.
As businesses across the country have shut down and laid off tens of millions of workers, the economy has sunk into a near-paralysis in just a few weeks.
Factories, hotels, restaurants, department stores, movie theatres and many small businesses are shuttered. Home sales are falling. Households are slashing spending. Consumer confidence is also sinking.
Critics of President Donald Trump slammed the White House over its seemingly slow response to the pandemic after the latest unemployment numbers were released.
“Today’s numbers are a result of the President’s failure to prepare for a pandemic,” Kyle Herring, president of the government watchdog group Accountable.US, said in a statement sent to The Independent. “Now that we’re in the midst of a crisis, the administration is more interested in helping big businesses and special interests than supporting small businesses on the brink of collapse.”
He added: “The American people need access to testing, safe work environments, and confidence in our government.”
With some signs that the viral outbreak may have plateaued at least in certain areas of the country, a few governors have taken tentative steps to begin reopening their economies. But surveys show that a large majority of Americans remain wary of returning to shopping, travelling and other normal economic activity.
That suggests that many industries will struggle with diminished revenue for weeks or months to come and might be unable to rehire laid-off workers.
Across nearly every industry, nonessential businesses have closed, and workers have been sent home with no clear idea of when or whether they might be recalled. An economic recovery may be months or years off, though governors in a few states have begun allowing some businesses to reopen under certain restrictions.
The Associated Press contributed to this report
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