COVID-19 Rips Through Jobs At A ‘Speed And Depth’ That Is ‘Gut-Wrenching’ [SURVEY]

As the coronavirus continues to barrel through the U.S., unemployment has skyrocketed, leaving more than 6.648 million workers without a job. The U.S. Bureau of Labor Statistics released its March employment survey, with what many are calling a conservative 4.4% unemployment rate estimate that doesn’t take into account the full impact of COVID-19.

“At this point, 90 percent of the U.S. population lives in a state or municipality which has mandated the closure of a large swathe of the local economy,” Michael Farren, Mercatus economist, said.

“The shutdowns explain why unemployment insurance applications skyrocketed to 3.3 million the week after the jobs report surveys, and to 6.65 million last week. If we assume that every person who was laid off or furloughed over those two weeks immediately applied for unemployment insurance, then the unemployment rate at the beginning of this week was around 10.5 percent.”

According to the Bureau of Labor Statistics’ survey, the 4.4% unemployment rate estimate is the largest over-the-month increase in unemployment since 1975. The survey said all major workgroups saw an increase in unemployment with 4% increases for men and women, and 14.3% increases for teenagers. The highest population experiencing unemployment were African Americans at 6.7%, followed by Hispanics at 6%.

“Under normal circumstances, the monthly release of the Bureau of Labor Statistics jobs report is an eagerly-awaited event,” Farren said. “Normally today’s report would make a big splash: The economy lost over 700,000 jobs between mid-February and mid-March, the first net job loss in over 10 years, bringing the record-making employment expansion to a close. After achieving the lowest unemployment rate in 50 years, we’ve just seen the largest jump in the unemployment rate since 1975, from 3.5% to 4.4%.”

In particular, leisure and hospitality employment fell by 459,000 jobs with a specific decline in food services and drinking establishments while healthcare and social assistance employment fell by 61,000 with job losses in dental, physician offices and other healthcare practitioner offices. However, healthcare employment grew by 374,000.

Social assistance jobs also took a hit with a decline in 19,000 jobs, decreasing in child care services. Professional and business services also decreased by 52,000 jobs, with the decline primarily seen in temporary help services.

Travel and reservation services reduced by 7,000 jobs while retail employment declined by 46,000 with job losses seen at clothing and accessory, furniture, sporting foods, hobby, book, and music stores. General merchandise store jobs gained 10,000 positions.

Construction has also been impacted by the coronavirus, with a decrease in 29,000 jobs seen in nonresidential building and heavy and civil engineering construction. Mining jobs also decreased by 6,000 jobs, with manufacturing slowing by 18,000 jobs.

Federal employment increased by 18,000 jobs for the month with hiring of 17,000 workers for the 2020 Census. Jobs in wholesale trade, transportation, warehousing, information, and financial services had little change over the month.

Diane Swonk, a chief economist at Grant Thornton, called the job losses due to COVID-19 “gut-wrentching,” saying that “This will only be a small fraction of the losses we will see in the April report, due out 5 long long weeks from now. Teens if not tens of millions of losses by then.”

Earnings for Americans was on the rise for March with an 11-cent increase for average hourly earnings to $28.62.