USA jobless claims skyrocket to 3.2 million as coronavirus hits the economy

Cheryl Sanders
March 26, 2020

It's bad: Based on state data, Morgan Stanley thinks the U.S. government could announce Thursday that 3.4 million people filed for their first week of unemployment benefits last week. The figure was more than four times greater than the previous record high of 695,000 from 1982. Almost every state that offered comments cited the virus as the reason for the spike, the department said.

The drop came after New York, California, and several other states ordered a complete shutdown of all non-essential establishments as a social distancing measure to prevent further spread of the coronavirus.

The numbers show that in Iowa, initial claims zoomed past 40,000.

"There are good reasons to believe that understandable constraints on the capacity of offices to process claims mean that the true picture of layoffs is even worse", Paul Ashworth, chief USA economist for Capital Economics, wrote in a note Thursday. That was up from 2,229 reported in the state the week before. There were 795 claims filed the week prior - a difference of 14,873 claims in one week.

In California alone, more than a million people have applied for unemployment benefits this month, Gov. Gavin Newsom said Wednesday.

Elsewhere, Connecticut's new weekly jobless claims were reported at 25,098 in the Labor Department's print Thursday.

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