The coronavirus impact on jobs looks brutal
Goldman Sachs is projecting that 2.25 million people could file for unemployment benefits this week.
A sign at a Las Vegas casino. Nonessential businesses across the US have been shutting their doors as the country tries to slow the spread of the coronavirus.
As lockdowns increase, businesses close and concern grows about the economic effects of the coronavirus pandemic, Goldman Sachs is projecting that a record 2.25 million people in the US could file for unemployment benefits this week. The analysis by financial services company Goldman is based on preliminary reports across 30 states.
"Many US states have reported unprecedented surges in jobless claims this week," a Goldman economist said in a note published Thursday. "While it is possible that claims were front-loaded to start off the week -- implying a slower pace of claims for the week as a whole -- or that our sample is biased toward states with a larger increase in claims, even the most conservative assumptions suggest that initial jobless claims are likely to total over 1 million."
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Goldman says the figure of 2.25 million "would easily surpass" the previous high, logged in 1982, of 695,000. The note adds that "anecdotes from a wide range of sectors also suggest an unprecedented decline in revenues across many industries."
Bank of America is predicting an even higher number of new jobless claims for the week: 3 million, according to a report from Bloomberg. B of A didn't immediately respond to a request for comment.
The number of US unemployment claims is already growing. A Thursday report from the Department of Labor, for the week ending March 14, says an additional 70,000 people filed jobless claims, bringing the total to 281,000 for the week. The previous week's unrevised level was 211,000, which the department notes is the "highest level for initial claims since September 2, 2017, when it was 299,000."
The department pointed to the coronavirus.
"During the week ending March 14, the increase in initial claims are clearly attributable to impacts from the COVID-19 virus," the department said in a press release, referring to the respiratory disease caused by the coronavirus. "A number of states specifically cited COVID-19-related layoffs, while many states reported increased layoffs in service-related industries broadly and in the accommodation and food services industries specifically, as well as in the transportation and warehousing industry, whether COVID-19 was identified directly or not."
Over the last few weeks, the coronavirus has spread across the US and is now in all 50 states. Last week, President Donald Trump declared a national emergency. On Thursday, California Gov. Gavin Newsom ordered people there to stay home except when handling essential needs, and on Friday, New York Gov. Andrew Cuomo ordered people there to stay home and told nonessential businesses to keep their workers at home.