The number of new applications for unemployment benefits last week soared by 130,000 to 853,000, the Labor Department reported on Thursday, as COVID-19 continues to wreak havoc on the job market.
“Our fears of a significant economic toll taken by the explosion in the COVID-19 cases have now been matched by a spike in new claims for unemployment benefits,” said Mark Hamrick, a senior economic analyst for Bankrate.
Economists had projected 725,000 new claims.
Altogether, over 1.2 million workers filed for benefits last week, when including claims for the Pandemic Unemployment Assistance program, which is a new category of eligibility for relief created for workers sidelined by the pandemic, such as gig workers whose work dried up.
Thursday’s report comes as coronavirus infections are rising across the country and businesses are facing shutdowns.
A record 1 million people were infected with the virus in the first five days of December. Since then, more than 600,000 have caught the disease, according to the COVID Tracking Project.
New York Gov. Andrew Cuomo warned that indoor dining in New York City could be shut down as soon as Monday if coronavirus hospitalization rates across the state don’t show signs of stabilizing.
To slow the spread of the virus, California Gov. Gavin Newsom, a Democrat, recently placed a three-week restriction on businesses that includes no indoor dining in restaurants and strict capacity limits at stores in certain parts of the state. The order will last through the Christmas holiday shopping season.
The total number of people claiming benefits in all programs for the week ending Nov. 21 was over 19 million. There were roughly 1.5 million weekly claims filed for benefits in all programs in the comparable week in 2019.
Meanwhile, Washington has yet to approve additional relief to help the unemployed and shuttered businesses.
“The failure of elected officials to agree to another round of economic relief legislation amounts to a kick in the teeth to millions of unemployed and struggling businesses,” Hamrick said.
Lawmakers are negotiating a bipartisan coronavirus aid package that would extend supplemental unemployment insurance for 16 weeks and provide $300 billion for the Small Business Administration to make loans to small businesses hurt by the economic consequences of the coronavirus. So far, there is no agreement on this deal.
