Thursday, April 02, 2020

Jobless Claims May Hit 5 Million This Week

Mitch McConnell has told Nancy Pelosi to forget about drafting a second stimulus bill demonstrating either how out of touch he is with reality or how little he cares about average Americans finding themselves suddenly unemployed (either one you pick is an indictment) with state unemployment offices unable to keep up with new claims being filed. Today, the past weeks new unemployment number swill be released and it looks like it will be horrific. One can hope it will force McConnell to get his head out of his ass, but don't hold your breath.  This is a man who thinks giving huge tax breaks to the very wealthy is fine, but who begrudges increasing meager unemployment payments.  A piece in the New York Times looks at projections of what today's numbers may look like.  Here are excerpts:

The Department of Labor reported last week that more than three million people filed for unemployment from March 15 to March 21, the largest single-week increase in American history.
But this Thursday’s number, which reflects claims filed last week, could rise to 5.6 million, according to an analysis of Google search data by the economists Paul Goldsmith-Pinkham of Yale and Aaron Sojourner of the University of Minnesota.
Morgan Stanley estimates that claims will rise to 4.5 million in tomorrow’s report; Goldman Sachs’s estimate is 5.5 million.
If these forecasts are accurate, there will be as many claims in two weeks as in the first six months of the Great Recession.
A few weeks ago, state agencies were releasing their own counts of jobless claims ahead of the federal government, but as those numbers reached record levels, the Trump administration asked them to withhold their counts before the official national release. (Some states, like Pennsylvania, are ignoring that request.) State resources have been severely strained with astronomical levels of interest from recently laid-off workers, leading to long wait times, nonworking websites and jammed phone lines. This suggests the true numbers are higher than what the Department of Labor will report Thursday. Mr. Goldsmith-Pinkham and Mr. Sojourner expect the previous numbers to be revised upward with the release of the new numbers Thursday. In normal times and even during typical recessions, so many people are being hired and fired daily that it’s hard to predict how many people will end up filing for unemployment.
The difference this time is that there is very little hiring to replace the losses, and the researchers thought their forecasts could be more accurate. So far, Mr. Goldsmith-Pinkham and Mr. Sojourner have found the relationship between searches and claims to be relatively stable.

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