U.S. weekly jobless claims remain elevated as millions of Americans seek unemployment benefits

Millions of Americans filed claims for unemployment benefits last week, reflecting that the layoffs are spreading to the industries that were initially not directly impacted by the business closures and the disruptions following the nationwide lockdown due to the pandemic. The American economy in the first quarter suffered the sharpest contraction since the Great Recession. This ended the longest-ever expansion in the history of the U.S. as the economy reels from the nationwide lockdown to contain further spread of novel Coronavirus. The initial claims for the state unemployment benefits totaled to 3.839 million for the week that ended April 25. That was considerably down if compared to 4.442 million in the prior week, but the numbers are still high.

Economists polled by Reuters had expected 3.50 million claims in the latest week. The applications for jobless benefits in the U.S. hit a record of 6.867 million in the last week of March. According to economists, job separations will mostly remain high for a while, as softer demand spills over the industries, which were initially not directly affected by the shutdowns. The filings of last week outgrew the number of people seeking unemployment benefits to around 30 million since March 21, which is nearly 18.4% of the working-age population. At face value, the growing joblessness implied a rise in the unemployment rate to above 15% in April.

The government has only allowed people who are temporarily unemployed for reasons related to the pandemic to file for the jobless benefits. This includes people who are quarantined with the expectation of returning to work after they recover, and as well as people leaving their jobs due to potential risks of exposure or infection or to take care of a family member who has been infected.