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Another 1.9 million Americans filed initial unemployment claims the week ending May 30, according to the U.S. Department of Labor. Since the start of the coronavirus shutdowns, a staggering 42.6 million jobless claims have been filed—greater than the combined population of America’s 22 smallest states.
That marks 11 straight week of unemployment claims above 1 million, a period of job-destruction without precedent in modern American economic history.
But the bigger economic story is that the overall number of Americans on unemployment insurance—known as continuing claims—climbed 649,000 to 21.5 million. The prior week it had fallen 4 million from its peak of 24.9 million the week ending May 9. Economists were hoping that continuing claims would fall again, however, the total number of Americans on unemployment is still down 3.4 million from its peak. That is a sign that employers are bringing workers back, and the economy has moved from contraction to growth. Moody’s Analytics chief economist Mark Zandi told Coins2Day yesterday that economic data points to the COVID-19 spurred recession ending in May, and that the economy is now in recovery.
Moving from the recession phase—at least two straight quarters of declining economic growth—and into the recovery phase doesn’t mean the economic storm has passed. It could take months or years to fully rebound to pre-pandemic levels.
Another report card on the labor market comes with Friday’s jobs report, which could see an unemployment rate near or even over 20% in May. But that May jobless rate will likely be the peak, Zandi forecasts, with it then falling in June, but staying above 10% until at least September.
The most jobless claims during the week ending May 30 were in California (230,461), Florida (206,494), and Georgia (148,095). The total number of Californians on the unemployment rolls rose a staggering 618,432 the week ending May 23—almost as mush as the entire 649,000 national increase that week. Meanwhile, Ohio and Michigan saw the biggest declines in the overall number of residents on the unemployment rolls, falling 88,494 and 69,911, respectively.
Americans currently on the unemployment rolls are receiving an additional $600 weekly in benefits on top of their state benefits. However, unless that additional federal money is extended, that extra $600 will stop after the end of July.
