WASHINGTON (Fox News): More than 2.1 million laid-off workers applied for unemployment last week, the Labor Department reported on Thursday, as the coronavirus pandemic, and the ensuing economic lockdown, continued to wreak havoc on the jobs market.
Economists surveyed by Refinitiv had forecast 2.1 million.
The new report, which covers the week ending May 23, pushes the 10-week total of losses since states directed residents to stay at home and forced nonessential businesses to close to 40 million, leading to levels of unemployment unseen since the Great Depression.
Still, although the number of workers seeking assistance remains significantly higher than it did before the coronavirus lockdown began — it’s the 10th straight week that layoffs were counted in the millions — it’s the lowest amount of jobless claims since the week ended March 15.
It marks the eighth week in a row of declining jobless claims since the peak of 6.9 million the week ended March 25.
While the jobless claims appear to be plateauing, some economists have suggested that a significant part of the American workforce could see prolonged unemployment. The Congressional Budget Office, a nonpartisan body, issued a bleak report last week suggesting that unemployment could remain as high as 8.6 percent at the end of 2021.
“Although initial claims are declining, the pace may only be plateauing,” said Daniel Zhao, senior economist at Glassdoor. “If [unemployment] claims remain in the millions for the next few weeks, it may signal that relaxed state-mandated restrictions alone aren’t enough to staunch the flow of unemployed Americans.”
That projection reinforces comments from Federal Reserve Chairman Jerome Powell that the economy’s recovery from the outbreak of the virus could stretch through the end of 2021 and may hinge on the completion of a successful vaccine.
“I would say though we’re not going to get back to where we were quickly. We won’t get back to where we were by the end of the year. That’s unlikely to happen,” the U.S. central bank chief said during a “60 Minutes” interview. He added: “For the economy to fully recover, people will have to be fully confident. And that may have to await the arrival of a vaccine.”