HUNTINGTON — Unemployment claims have skyrocketed across the nation, including Appalachia, as the reaction to the coronavirus has shut down or curtailed many businesses.
A record 3.3 million Americans applied for unemployment benefits last week, the Labor Department said Thursday, as restaurants, hotels, barbershops, gyms and more shut down in a nationwide effort to slow the spread of the deadly coronavirus. It was the biggest-ever jump in new jobless claims, surpassing the record 695,000 set in 1982. Many economists say this is the beginning of a massive spike in unemployment that could result in over 40 million lost jobs by April.
Claims also shot up in West Virginia, Ohio and Kentucky.
During Gov. Jim Justice’s virtual briefing Thursday on the impacts of the crisis, West Virginia Department of Commerce Secretary Ed Gaunch said WorkForce West Virginia had processed 41,549 initial unemployment claims and over 10,000 low-earnings claims since the governor issued his executive order last week that ordered various businesses to close.
Justice also issued an executive order directing the state Department of Commerce and WorkForce West Virginia to provide unemployment benefits to those affected by COVID-19 to the maximum extent permitted under federal law.
Workers who are separated from employment, have had their hours of employment reduced or are prevented from working due to either a documented medical condition caused by COVID-19 or due to communicable disease control measures related to COVID-19 are eligible for these benefits, according to the governor’s order.
The number of Kentucky residents filing for unemployment benefits also surged in the past week as many businesses closed or scaled back due to the coronavirus pandemic.
A total of 48,847 Kentucky residents applied for unemployment assistance last week, reflecting the dramatic economic disruption caused by the virus, the U.S. Labor Department reported Thursday.
In the prior week, 2,785 claims were filed in Kentucky.
In response to the influx of people seeking unemployment benefits, the state recently started new filing procedures and opened new local office phone lines.
Kentuckians seeking unemployment benefits are asked to follow a schedule aimed at spreading out claims filings. The day people can file claims is based on the first initial in their last names.
In Ohio, jobless claims soared from about 7,000 to nearly 188,000 in the week ending Saturday, according to the Ohio Department of Job and Family Services. That total for a single week was more than Ohio has seen in any full month except one, during the depth of the 1980s recession.
Gov. Mike DeWine had ordered a vast array of businesses to close or scale back operations to slow the outbreak, including bars, restaurants, gyms, theaters, recreation centers, bowling alleys and water parks.
In just three days last week, Ohio received nearly 78,000 claims for unemployment compensation — a 2,579% increase from the same period in the previous week, according to published reports.
The nation’s unemployment rate was 3.5% in February, a half-century low, but that has likely risen already to 5.5%, according to calculations by Martha Gimbel, a labor economist at Schmidt Futures. The nation hasn’t seen that level of unemployment since 2015.
“This morning’s jobless claims confirm that the United States is in the thralls of a catastrophic unemployment crisis, the likes of which we haven’t seen since the Great Depression,” said Andrew Stettner, a senior fellow at the left-leaning Century Foundation.
“We may well be in a recession,” said Federal Reserve Chairman Jerome Powell in his first appearance on morning television. “The first order of business is to get the virus under control and then resume economic activity.”
A lot of workers are not allowed to apply for unemployment benefits, meaning the true number of layoffs so far due to the coronavirus is likely far higher than 3.3 million. Self-employed workers, gig workers, students and people who worked fewer than six months last year are typically not eligible to apply for unemployment insurance in most states.