WASHINGTON—A record 7.5 million Americans were receiving unemployment benefits at the end of March as the coronavirus pandemic continued to hit the U.S. labor market.
The Labor Department reported Thursday that another 6.6 million had submitted claims in the week ended April 4 after reaching a record 6.9 million revised figure from a week earlier. Claims were hovering at just over 200,000 a week before the coronavirus-related shutdowns put millions of people out of work in mid-March.
Continuing claims, a figure that captures the number of people receiving benefits, grew by 4.4 million in the week ended March 28 to 7.5 million, eclipsing a record set in 2009 at the end of the financial crisis.
Jobless claims, a proxy for layoffs, provide temporary financial assistance for workers who lose their jobs. The Labor Department releases a national compilation of weekly jobless claims on Thursdays.
Each additional week of historically high jobless claims dims the prospects for a rapid economic recovery once the new coronavirus is contained in the U.S. and businesses start reopening.
“The biggest direct impact of the loss of jobs is going to be the loss of income and therefore the loss of spending,” said Jacob Robbins, assistant professor of economics at the University of Illinois at Chicago.
It isn’t clear exactly when jobless claims will peak, but evidence suggests that they will continue to register high levels in the coming weeks. The federal rescue package signed into law in March increases the pool of workers who can tap benefits by making independent contractors and self-employed people eligible, at least in some cases.
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Perhaps more significantly, states are still addressing backlogs of claims. Many laid-off Americans have been unsuccessful in applying for unemployment insurance because state labor department websites are freezing and their phone lines are inundated with inquiries.
Corinne Chin, a 23-year-old of Brooklyn, New York, hasn’t been able to apply for unemployment benefits since she was furloughed from her creative-marketing agency in mid-March because of the coronavirus.
She said she sometimes calls New York’s labor department hundreds of times a day.
Continued jobless claimsSource: Labor DepartmentNote: Seasonally adjusted
“I’m stuck right now, and I haven’t been able to get through to any representatives,” she said.
Ms. Chin has savings but is worried about her financial situation in a couple of months if she still doesn’t have any income. Most of the companies in her industry have implemented hiring freezes. She said she is hesitant to seek a job where work is available, such as at a grocery store, because of the possibility she could be exposed to the coronavirus.
States are adapting to address an unprecedented rise in applications for unemployment benefits. Many have reallocated or added staff to handle calls and claims audits.
Subrina Norton, 50, is one American drawing on jobless benefits. She applied for unemployment insurance immediately after getting laid off from her Oklahoma City waitressing job in March. Her online application kept getting rejected, prompting her to try calling.
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She was able to receive her unemployment benefits after she contacted the office of one of her U.S. senators, James Inhofe. The senator’s office put her in touch with a state official who was able to help her fill out the application forms.
“It was just a blessing because I was really getting stressed out,” Ms. Norton said.
Her checks, for $150, started arriving less than two weeks after she was laid off from her $7.25 -an-hour job. She is still waiting for the additional $600 payments that were included as part of the federal rescue package.
The Labor Department told states on Tuesday night that they could draw on federal funds to disburse additional unemployment payments of $600 to jobless Americans who are eligible for benefits. Residents in New York and Illinois have started receiving these payments, but the majority of unemployed Americans are still waiting for the expanded checks.
Layoffs are hitting a widening array of industries, state-level data suggest.
Take Oregon as an example. In the week ended March 21, slightly more than 30% of the state’s jobless claims were from laid-off workers in the restaurant industry. In the week after, the share of claims from restaurant employees remained roughly the same, but the portion of claims coming from health-care and retail workers rose.
“There’s still a lot of these sectors for this virus to go through,” Mr. Robbins said. “This is what’s really concerning me right now.”
The steep rise in joblessness is keeping job-training centers like Goodwill in Fort Worth, Texas, busy.
“People are calling in, and they’re like, ‘I need a job. I need it right now. I’ve got to feed my kids,’” said Romney Guy, vice president of workforce development at Goodwill in Fort Worth.
The Goodwill location is now offering virtual job training to help people develop resumes, as well as interviewing and computer skills. Ms. Guy said the job-training center is seeing an increase in upper-middle-income people seeking assistance.