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Unemployment Applications Skyrocket as Companies Lay Off Workers Amid Coronavirus Crisis

Unemployment Applications Skyrocket as Companies Lay Off Workers Amid Coronavirus Crisis

Claims for unemployment benefits skyrocketed by 70,000 over the past week as the coronavirus crisis takes its toll on the economy, NPR reports.

The Labor Department said Thursday that the number of unemployment applications rose to 281,000 last week, the highest number since September 2017.

The Labor Department said that "a number of states specifically cited COVID-19 related layoffs, while many states reported increased layoffs in service-related industries broadly and in the accommodation and food services industries specifically, as well as in the transportation and warehousing industry, whether COVID-19 was identified directly or not."

Numbers could sink lower:

The numbers are expected to increase even more this week.

Oxford Economics predicted that the report showed just "a small preview of what's to come.”

“We expect the virus to cause significant job losses as the economy sinks into a deep recession,” the economy forecaster said.

Mnuchin warns of 20% unemployment:

Treasury Secretary Steven Mnuchin warned Senate Republicans in private that the unemployment rate could rise to 20% during the crisis.

Mnuchin later told CNBC that that he does not believe “in any way” that “we’re going to have that.”

“What I said was just a mathematical statement,” he said. “Which is, 40 percent of the people that are employed in the private workforce are employed by companies [of] 500 people and less. It was just a mathematical statement to to say, ‘If half these people were to lose their jobs, this is what it would be. But we’re not going to let that happen. This isn’t like the [2008] financial crisis. There will be an end in sight.”