Claims for unemployment benefits up 3.3 million, setting new record.

Even when it’s expected, the jump in  unemployment startles. Today’s report from the Bureau of Labor Statistics tells the story of the pandemic’s toll on the economy.

In the week ending March 21, the advance figure for seasonally adjusted initial claims was 3,283,000, an increase of 3,001,000 from the previous week’s revised level. This marks the highest level of seasonally adjusted initial claims in the history of the seasonally adjusted series. The previous high was 695,000 in October of 1982. The previous week’s level was revised up by 1,000 from 281,000 to 282,000. The 4-week moving average was 998,250, an increase of 765,750 from the previous week’s revised average. The previous week’s average was revised up by 250 from 232,250 to 232,500.

“The previous high was 695,000.” Now we’re at 3.3 million. 

Bill McBride published a chart in Calculated Risk that shows how the spike in initial claims compares with previous recessions. There’s really nothing comparable. 

He adds,

At the worst of the Great Recession, continued claims peaked at 6.635 million, but then steadily declined.

Over the next few weeks, continued claims will increase rapidly to a new record high, and then will likely stay at that high level until the crisis abates.

When that is, who knows? Please. Soon.

The Associated Press reports,

As job losses mount, some economists say the nation’s unemployment rate could approach 13% by May. By comparison, the highest jobless rate during the Great Recession, which ended in 2009, was 10%…

Ellen Zentner, an economist at Morgan Stanley, said in a note to clients that 17 million jobs could be lost through May — twice the entire 8.7 million jobs that were lost in the Great Recession. She expects the unemployment rate to average 12.8% in the April-June quarter, which would be the highest level since the 1930s.

Still, Zentner also expects the economy to start recovering by the second half of the year. It will take time for things to return to something close to normal, she projects: The unemployment rate could still top 5% at the end of next year.

Last week we noted skyrocketing claims in our state.