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17 Dec, 2020 14:51

US jobless claims surge as Congress dickers over too little, too late stimulus package

US jobless claims surge as Congress dickers over too little, too late stimulus package

US unemployment claims for the week have soared to 885,000, significantly higher than economists’ predictions. The figure is just one of several dire statistics outlining a painful future for the lockdown-ravaged economy.

Some 23,000 more Americans applied for unemployment benefits this week than last, according to ominous statistics released by the US Department of Labor on Thursday. The figure represents a 14-week high in unemployment filings, flying in the face of the slight recovery predicted by economists. 

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While the total number of Americans receiving unemployment checks has declined steeply from its May peak of 23 million, with “just” 5.5 million receiving standard benefits, the drop is due more to the expiration of benefits associated with March’s CARES Act bailout than any real-life economic turnaround.

A total of 71 million Americans have filed for unemployment since March, when states began shutting down entire sectors of their economies in response to the burgeoning coronavirus pandemic’s arrival on US shores. With Covid-19 cases continuing to climb, local governments in many states have indicated they have no intention of allowing Americans to return to work anytime soon, and some – particularly California and New York – are actually imposing stricter controls on commerce.

Congress has yet to pass a second stimulus package, though Democrats and Republicans are allegedly approaching a compromise that will include sorely needed aid for small businesses and an anemic round of individual checks. A nationwide eviction moratorium as well as some expanded unemployment programs are set to expire at the end of the month, a disastrous outcome that could leave many Americans literally out on the street if another bailout is not passed.

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Despite the gloomy outlook, the Federal Reserve on Wednesday suggested the economy will recover rapidly next year with the widespread rollout of Covid-19 vaccines – after a three- to six-month period of intensified suffering for small businesses and the unemployed. However, many Americans have indicated they are reluctant to be among the first group to be vaccinated, pointing to the rushed deployment of the leading jabs compared to normal vaccine development timetables. 

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