The job losses continued, as expected, with 3.84 million people filing new claims for unemployment in the week that ended on April 25. That follows on 4.44 million new claims for unemployment in the prior week. Economists surveyed by Bloomberg had projected 3.5 million new claims.
In the past six weeks 30.3 million people have filed initial claims for unemployment. Economists estimate that the national unemployment rate sits between 15% and 20%, compared to about 25% at the peak of the Great Depression and 10% during the Great Recession.
The next monthly jobs report is due on Friday, May 8. Economists estimate that the report–which will cover the period from mid-March to mid-April–will show a decline of 22 million jobs and a headline unemployment rate of 16.3%.
The Labor Department doesn’t provide an industry by industry breakdown of how unemployment is growing. But the Economic Policy Institute has used government figures to do exactly that. Building on the EPI work, Andrew Van Dam at the Washington Post has provided a very clear breakdown of how job losses are shifting as the coronavirus recession develops.
Please check out the Post article–like all coronavirus coverage on the Post it’s free.
My summary:
Week 1, March 15-21: Industries that require the most face-to-face customer contact took the worst of the job losses. More than 7% of all restaurant, hotel, and bar workers filed for unemployment in this week.
Week 2, March 22-28: The shutdown moved from businesses where the primary danger is interacting with customers to those, like construction and manufacturing, that require in-person interaction among large groups of workers. By the middle of March, retail job losses soared.
Week 3, March 29-April 4: Job losses worked their way up the supply chain, as wholesale trade — a sector that includes some sales representatives, truck drivers and freight laborers — got hit hard.
Week 4, April 5-11: White collar industries, which had been shedding jobs since mid-March, moved up the ranks of hard-hit sectors as managers, bookkeepers, insurance agents and bank tellers faced huge furloughs.
Week 5, April 12-18: The public sector began shedding jobs as state and local governments, made budget cuts in the face of plunging revenue. This round of job cuts is just beginning, unfortunately. Estimates say that public sector job cuts could push total job losses past 40 million.
(The data available for analysis only runs through April 12-18.)
In a separate but no more cheery report today, the Commerce Department said household spending, dropped 7.5% in March from February. That’s the sharpest drop in department records back to 1959.
