Sobering jobs outlook: ‘We’re expecting a long haul’
By Tiffany Hsu
Although the first wave of reopenings is returning workers to restaurants, retailers and other businesses hit hard by the coronavirus pandemic, layoffs are seeping through sections of the job market that previously escaped major damage. On Thursday, the Labor Department said more than 1.5 million Americans filed new state unemployment claims — the lowest number since the crisis began, but far above normal levels.
A further 700,000 workers who were self-employed or otherwise ineligible for state jobless benefits filed new claims for Pandemic Unemployment Assistance, a federal aid program. The overall number of workers collecting state benefits fell slightly in the most recent seasonally adjusted tally, to 20.9 million in the week ended May 30, from a revised 21.3 million the previous week.
“We’re slowly seeing the labor market recovery begin to take form,” said Robert Rosener, an economist at Morgan Stanley, pointing to an “initial reopening bounce.” But, he added, “there’s still an enormous amount of layoffs going on in the economy.”
On Monday, BP said it would lay off 10,000 people worldwide, mostly office-based workers. The entertainment promotion giant AEG told employees that it would carry out layoffs, furloughs and salary reductions on July 1. Job losses were announced this week at the University of Denver, the nonprofit group UJA-Federation New York, and the city of Peoria, Illinois, among others.
The weekly report on unemployment claims comes after the government reported that jobs rebounded last month and that the unemployment rate fell unexpectedly to 13.3%. Correcting for a classification error, the actual rate was closer to 16.4% — still lower than in April, but higher than at any other point since the Great Depression.