This morning the Department of Labor announced that new claims for unemployment for the week ending March 14 climbed to 281,000. That was up from 211,000 in the prior week. And much worse than the 220,000 projected by ecomomists.
The worst news is that this spike in initial claims for unemployment comes in a period before the U.S. economy has seen the full effects of social-distancing shutdowns of bars, restaurants, music venues, sporting events, etc. The New York City bar and restaurant shutdown, for example, didn’t go into effect until March 17.
The Department of Labor said that many states specifically reported increased layoffs in accommodation and food services industries as well as in transportation and warehousing.
Treasury Secretary Steve Mnuchin in his arguments to Congress for a big coronavirus economic package has repeatedly forecast in recent days that the country could see the unemployment rate ratchet quickly upward to 20%.
The pre-coronavirus unemployment rate hit 3.5% in February, a 50-year low.