May 28, 2020 - Economy

2.1 million Americans filed for unemployment last week

Data: U.S. Employment and Training Administration via FRED; Chart: Andrew Witherspoon/Axios
Data: U.S. Employment and Training Administration via FRED; Chart: Andrew Witherspoon/Axios

Another 2.1 million people filed for unemployment last week, the Department of Labor said on Thursday.

Why it matters: Even as states reopen their economies, the number of newly filed unemployment applications remains historically high as the pandemic slams the labor market.

The big picture: The number of weekly jobless claims during the coronavirus crisis peaked at 6.9 million in late March. While the pace of newly filed applications has slowed, they are still higher than at any point in modern history before the pandemic hit.

  • The headline figure released by the Labor Department doesn't include those who last week filed for "Pandemic Unemployment Assistance," which extends unemployment benefits to the self-employed and gig workers under the federal stimulus bill.
  • 38 states reported 1.2 million Americans applied for that program last week. Other states still aren't reporting how many people are applying for this program to the Department of Labor.

By the numbers: The total number of people continuing to receive unemployment benefits — after initially applying — fell by 3.9 million to 21 million. That's still more than three times higher than the prior record set back in 2009.

  • This figure reports with a two-week lag.

Between the lines: Businesses have reported trouble getting laid off or furloughed workers to come back.

  • In a Federal Reserve survey of businesses around the country released Wednesday, "workers' health concerns, limited access to child care, and generous unemployment insurance benefits" were among the reasons businesses said workers weren't returning.
  • The CARES Act grants an additional $600 in benefits per week to jobless Americans, on top of the amount usually paid out weekly.
  • Those benefits end in July — and there's debate among economists and policymakers about whether that additional payout of benefits should be extended.

What's next: The government's May jobs report will be released next week, and economists expect the unemployment rate to be north of 20%.

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