The economy lost 701,000 jobs in March as the coronavirus forced businesses across the nation to shut down, according to new data from the Bureau of Labor Statistics.
The unemployment rate rose to 4.4% as the food and hospitality industries were particularly hard hit, losing nearly a half-million jobs.
The report also cited “notable declines” in jobs in the retail, health care, construction, professional services, and social assistance sectors.
But the official data is only the tip of the iceberg.
This week saw more than 6 million new unemployment claims, bringing the total over the last two weeks to 10 million, eclipsing the peak during the Great Recession.
Economists say true numbers “much worse”:
Justin Wolfers, an economist at the University of Michigan, said the BLS data, which was compiled three weeks earlier, missed the economic devastation of the subsequent weeks.
Wolfers estimated that the economy lost an “additional 16 MILLION jobs in the weeks since.”
“It may be jarring to see in the official numbers that the unemployment rate has risen from 3.5% to 4.4%,” he wrote. “But the reality is much worse: My calculations suggest that in the ensuing three weeks since these numbers were collected, the unemployment rate has risen to 13%.”
More job losses to come:
While the official data has not yet caught up to the reality on the ground, April may be even worse than March, some economists predict.
“The main message is the labor market conditions started to slip in March, but obviously with the last two initial claims reports we’ve seen, we know April will be a disaster for labor markets,” Michael Gapen, a top economist at Barclays, told CNBC. “We still have two more weeks, and we’re probably looking at an unemployment rate of more than 10% in April.”
“The suddenness with which it all slipped off a cliff in two weeks is shocking,” he added. “We now have stay-at-home orders in states that account for 82% of GDP.”