This figure is in addition to the 3.3 million new unemployment benefit claims registered the previous week. Economists fear an unemployment rate higher than 30%. 6.65 million new applications for unemployment benefits in a week. It is unprecedented for the American economy, hit hard by the rapid spread of the coronavirus epidemic. This figure is to be compared to the 3.3 million registrations made the previous week, which already constituted a historic record at the time. The precedent dated back to October 1982, at the height of the recession following the second oil shock (695,000 requests).
The jump in the number of job seekers is explained by the stoppage of part of the American economy, stopped net by the rapid progression of the epidemic of coronavirus in the United States. And by the proliferation of containment measures, which now affects 96% of the population, and of closure of non-essential businesses in many States. However, no partial unemployment scheme is included in American law. Employees of closed restaurants, for example, who have lost their jobs or been placed on unpaid leave, must register for unemployment benefits.
These bad figures will not, however, be taken into account in the official statistics of the Labor Department, which will be published this Friday. Because they stop on March 14, before the start of the main containment measures. Economists are betting on average 10,000 fewer jobs. On Wednesday, the ADP cabinet reported the destruction of 27,000 jobs in the private sector over the same period. It is the first contraction in private employment in ten years.
For several weeks, economists have been trying to quantify the short-term impact of the current crisis. And their opinions strongly differ. JPMorgan expects, for example, an unemployment rate of 8.5% at the height of the crisis, when Goldman Sachs predicts a maximum rate of 15%. The St. Louis Federal Reserve is even more pessimistic: it fears 47 million job cuts in the United States, which will translate into an unemployment rate of 32%. In February, it was only 3.5%.
The question is, what percentage of these job cuts will only be temporary: to reopen in a few weeks, a restaurant will have to re-hire. But like European countries, the United States could also experience a marked contraction in their activity. Goldman Sachs economists, among the most pessimistic, anticipate that US GDP could contract by 34% in the second quarter at an annualized rate. What threaten the survival of many companies.
Recovery plan
To face it, the American Congress adopted at the end of March a revival plan, him also, of an unprecedented scale: 2,000 billion dollars. It notably plans to extend the unemployment benefit period to four months, while increasing the amount paid to job seekers. Another measure: sending checks to families. Up to $ 1,200 for adults earning less than $ 99,000 a year, and an additional $ 500 per child. A means of supporting consumption, hopes the parliamentarians.
The text also includes $ 367 billion in loans for small businesses. These loans will not have to be repaid if the beneficiary does not fire its employees during the crisis period. In addition, an additional $ 500 billion will be allocated to sectors hit hard by the coronavirus epidemic, such as airlines, hotel groups and cruise lines. Not necessarily enough, say economists, when no one knows when activity will really restart.
