Between March 15 and April 3, the number of Americans filing jobless claims will likely surpass 15 million.
The numbers for the week ending April 3 remain estimates; but we know for a fact that more than 10 million Americans reported being out of work in the preceding two weeks.
And this is by no means over. Economists expect that 20-25 million Americans may find themselves out of work, at least temporarily, in the coming months.
It’s hard to explain just how catastrophic these numbers are. In a word: unprecedented.
Counting the damages
The 6.6 million jobless claims during the week ending March 27 represented a 3000% increase from the beginning of March all on their own. For perspective, the very worst week for jobless claims during the Great Recession of 2008 was approximately 600,000. The effects of the COVID-19 crisis are an order of magnitude more severe.
Just how severe is not yet clear. In the first place, the numbers may be incomplete, as states are struggling to deal with the tsunami of jobless claims.
Also, ongoing changes with regard to who qualifies for benefits have muddied the waters. Someone who applied last week may have been rejected on the basis they didn’t qualify; but closed loopholes may allow them to draw benefits as of this week.
We also have to consider the possibility that some jobs won’t be coming back when the crisis abates.
Retail chains were already facing enormous pressures before COVID. With the advent of social distancing, many more people will be getting familiar and comfortable with shopping online. It’s possible this pandemic may speed the decline of brick-and-mortar retail.
The airlines have also been hard hit. Will business go back to normal in the next six months? If not, those carriers that have struggled to pay their bills may find themselves being bought up by their competition, with all the attendant job losses.
And then, of course, we have to consider how long this crisis will last. Another month? Two? Three? It may be we’ll be looking at Great Depression levels of unemployment before all is said and done.
For the time being, we simply don’t know what the future has in store. But we do know the U.S. has pushed past 10% unemployment, which means this has officially become a more acute economic downturn than the Great Recession. Whether it will be as long-lasting remains to be seen.