US weekly unemployment claims jump by 6.6 million, bringing 3-week total to more than 16 million

RT
Thu, 09 Apr 2020 17:17 UTC

© Reuters / Nick Oxford

People who lost their jobs wait in line to file for unemployment benefits, following an outbreak of the coronavirus disease (COVID-19), at Arkansas Workforce Center in Fort Smith, Arkansas, U.S. April 6, 2020.

The US Labor Department reported on Thursday that the jobless rolls continued to grow due to the Covid-19 lockdown, with 6.6 million Americans filing first-time unemployment claims in the week ending April 4.

The figure nearly matches the jump registered in the previous week when 6.87 million people filed initial claims and brings the total jobless claims for the last three weeks to more than 16 million.

The ongoing surge in filings for unemployment insurance has been aggravated by the expansion of those who are allowed to file claims. The CARES Act has expanded the group to include the self-employed and independent contractors.

Most of the job losses come from restaurants and drinking establishments, while healthcare and social assistance have been also hurt. The Labor Department's survey of households found a drop of nearly three million from the employment ranks.

Following the new jobless report, the US Federal Reserve immediately rolled out a $2.3 trillion stimulus package on Thursday aimed at small businesses and municipalities across the country.

"Our country's highest priority must be to address this public health crisis, providing care for the ill and limiting the further spread of the virus," Fed Chairman Jay Powell said.

"The Fed's role is to provide as much relief and stability as we can during this period of constrained economic activity, and our actions today will help ensure that the eventual recovery is as vigorous as possible," he added.

Comment: From Fort Russ:

The fallout from the coronavirus outbreak that has killed around 90,000 people and wreaked havoc on economies around the world could push around half a billion people into poverty, Oxfam stated on Thursday.

The report released by the Nairobi-based charity ahead of next week's International Monetary Fund (IMF)/World Bank annual meeting calculated the impact of the crisis on global poverty due to shrinking household incomes or consumption, FRANCE24 reported.

"The economic crisis that is rapidly unfolding is deeper than the 2008 global financial crisis," the report found.

"The estimates show that, regardless of the scenario, global poverty could increase for the first time since 1990," it said, adding that this could throw some countries back to poverty levels last seen some three decades ago.

...

To help mitigate the impact, Oxfam proposed a six-point action plan that would deliver cash grants and bailouts to people and businesses in need, and also called for debt cancellation, more IMF support, and increased aid. Taxing wealth, extraordinary profits, and speculative financial products would help raise the funds needed, Oxfam added.

Calls for debt relief have increased in recent weeks as the fallout from the COVID-19 pandemic has roiled developing nations around the world. In total, governments around the world would need to mobilize at least $2.5 trillion to support developing nations.

"Rich countries have shown that at this time of crisis they can mobilize trillions of dollars to support their own economies," the report said, adding, "Yet unless developing countries are also able to fight the health and economic impacts the crisis will continue and it will inflict even greater harm on all countries, rich and poor."