US unemployment rate touched a record high this week said the Labor Department on Thursday. A record 3.28 million Americans filed for unemployment benefits last week, as efforts to contain the deadly coronavirus brought the country to a standstill, with thousands losing jobs over the past few weeks.
Coronavirus is biting into the profits of businesses with restaurants, hotels, barber shops, gyms and stores shut over the past few weeks. This has not only seen businesses incurring huge losses but also massive layoffs. Coronavirus has already infected more than 74,000 in the US with at least 1,046 deaths.
Unemployment rate tops Great recession peak
A large number of US citizens have been displaced by the coronavirus and have lost jobs in recent times. The Labor Department said that this week's unemployment claims hit a record high of 3.28 billion. The number tops the Great Recession peak of 665,000 in March 2009 and the all-time high of 695,000 in October 1982.
The jobless claims recorded this week clearly show how the economy has and is being affected by the coronavirus pandemic. Last week, which showed the period before the worst of the coronavirus hit the US, was 282,000. That too was higher than estimates as the coronavirus hadn't shown signs of hitting the US economy to that range yet.
Unemployment rate may go up
Many economists believe that the worst is yet to come with more American filing for unemployment benefits over the next few weeks. Economists feel that there could be a massive spike in unemployment that could see 40 million ending up losing their jobs by April because of coronavirus.
The wave of layoffs owing to the coronavirus outbreak also ended the long streak of employment boom in the US. Coronavirus has been hitting the US economy more over the past three weeks. The crisis has now deepened so much that the US Senate had to arrange for a record $2 trillion stimulus package to help the economy get back on its feet.
Most of the layoffs were in the hospitality, food, healthcare, entertainment, arts, travel, transportation, warehousing and manufacturing industries. However, the spike in unemployment owing to coronavirus didn't dent investors' sentiments. Stocks jumped once again on Thursday following the passing of the coronavirus stimulus bill by the Senate on Wednesday. The House is scheduled to vote on the $2 trillion coronavirus stimulus bill on Friday.