Long-term unemployment continues to grow
San José, CA – On Thursday, October 22, the U.S. Department of Labor reported that there were 787,000 new claims for regular state unemployment in the week that ended October 17. This was 55,000 fewer than the previous week, but still 20,000 higher than two weeks ago and almost four times as high as the same week a year ago. While new claims have fallen dramatically from the record high of almost 6 million in April, they are still higher than the pre-recession high of less than 700,000.
The report also said that continuing claims for regular state unemployment did fall by a million to 8.4 million for the week ending October 10. But not all of these people found jobs. Long-term unemployed people who have run out of the regular state unemployment insurance are swelling the ranks of the federal Pandemic Emergency Unemployment Compensation or PEUC and the state Extended Benefits. These two programs gained almost 600,000 people in the last week reported on. Other workers are dropping out of the labor force by giving up on their job search, as did 700,000 people in September.
Despite some improvements in the job market, the fact remains that more that more than 23 million people are receiving government jobless aid. This is 13 times the number of people who were collecting unemployment before the recession and represents more than 14% of the labor force.
In addition to the constant drumroll of layoff announcements and opposition to more economic relief in the Republican Senate, there is the third wave of COVID-19 in the United States. New infections just hit an all-time record of 82,000 in one day. Hospitalizations for the virus are also up 40% from just a month ago, and the daily number of deaths are up 9% from two weeks ago. In Europe, where the pandemic is also surging, the economy is taking a number of hits, with the two largest eurozone economies, France and Germany, reporting that their service sector is starting to contract again.
President Trump responded to the rising infections, hospitalizations and deaths by repeating his mantra of, “And as I say, we’re rounding the turn. We’re rounding the corner. It’s going away.” This is a stark echo of Republican President Herbert Hoover who insisted that prosperity is just around the corner even as the economy fell into the depths of the Great Depression.