38.6 Million Have Filed For Unemployment Since March
NOEL KING, HOST:
The hole in the U.S. job market keeps getting deeper. The Labor Department reported this morning that another 2.4 million people applied for unemployment last week. That's lower than the week before, but it is still painfully high. NPR's chief economics correspondent, Scott Horsley, is on the line with me. Good morning, Scott.
SCOTT HORSLEY, BYLINE: Good morning, Noel.
KING: So we have two things happening simultaneously. We have businesses reopening in some parts of the country, but week after week, we are still seeing millions of jobless claims. What's happening?
HORSLEY: Right. The pace of layoffs is slowing. Last week's claims were down about 9% from the week before. But the state unemployment offices are still really busy. Over the last nine weeks since the stay-at-home orders began, we've seen more than 38 million claims for unemployment. That represents about 1 in every 4 people who was working back in February before this began. About half of the new claims last week were filed by regular payroll employees, the kind of folks who typically get unemployment. The other half were filed by people who traditionally are not eligible for unemployment, folks like gig workers or self-employed people. And it's taken a while for states to get those emergency jobless programs up and running. So some of the claims that we saw last week might have been from people who were out of work before that but are only just now able to file.
KING: And that makes sense. Who is being affected by job cuts?
HORSLEY: Disproportionately, it's people on the lower rungs of the income ladder. The Federal Reserve did a survey back in early April that found about 20% of workers had lost jobs by that time. But among households making less than $40,000 a year, it was almost 40%. So job losses have been especially hard on those who are least able to afford it. As time goes on, though, we are seeing ripple effects into industries that weren't necessarily hit right away. You know, if restaurants and retail bore the early brunt of the downturn, we're now starting to see more job cuts in health care, in finance, in educational services and public administration. Those last two reflect some of the cuts that state and local governments are starting to make as the pandemic punches a hole in their budgets.
KING: And so what kinds of help are unemployed people getting at this point?
HORSLEY: They are finally starting to get more help from the federal government. It's taken time, but all the states are now paying that extra $600 a week in federal unemployment benefits that Congress authorized. A majority of states are now able to pay for those newly eligible gig workers and self-employed people. The Treasury Department says as much money went out in unemployment benefits in the first two weeks of May as in all of April. So that is certainly helping, although we continue to hear from unemployed people who say they've had trouble actually getting their benefits.
KING: You know, some people who were furloughed are going back to work. We've seen lots of reporting on that. What does that mean for the unemployment rate?
HORSLEY: It does mean that not all of those 38 million people who filed claims the last couple of months are still out of work; some have been recalled. You know, we've had auto plants restarting this week in states where stay-at-home orders have been relaxed. Restaurants and retail shops have started to bring people back to work. But it's a slow process. We're talking about greatly reduced levels of business. Treasury Secretary Steve Mnuchin told lawmakers this week unemployment's going to get worse before it gets better. It was nearly 15% in April. It's going to get higher than that. And we're likely to have very high levels of unemployment through this year. And remember right now, that extra $600 a week in benefits is set to run out at the end of July.
KING: Unemployment claims are just one lens into the economy. What else should we be looking at?
HORSLEY: That's right. As painful as these unemployment numbers are, they don't tell the whole story. There was a new survey out this week from the Census Bureau, which showed a lot of people who are still working have lost hours or had their wages cut. In total, 47% of households have seen a drop in income since the pandemic took hold. And, obviously, that's going to affect their ability and willingness to spend money. It's going to affect tax collections. It's going to be a huge weight on the broader economy.
KING: Almost half of all households. NPR's Scott Horsley. Scott, thanks so much.
HORSLEY: You're very welcome. Transcript provided by NPR, Copyright NPR.