Unemployment numbers are in for the week ending March 21 and they should not be surprising to anyone:
For the week ending on March 21, there were 3.283 million initial unemployment claims, the highest level on record by more than 2.5 million. UI data offer the first indication of coronavirus’ incomparable effect on the US labor market.
— CEA (@WhiteHouseCEA) March 26, 2020
But we’re seeing a lot of tweets along these lines where pundits seems shocked by the news:
INITIAL JOBLESS CLAIMS HIT RECORD 3.3M SMASHING ALL TIME RECORD OF 600K as #coronavirus slams the U.S. economy.
— Ben White (@morningmoneyben) March 26, 2020
Jesse Kelly has a message for everyone who was “shocked” or “stunned” by today’s news: “I saw this coming from the beginning. And I’m an idiot. You should have seen it too”:
Pundits,
If you’re “shocked” or “stunned” by today’s economic numbers, you live in a bubble. Take some time to expand your circle so it includes more people outside of the NYC/DC pipeline.
I saw this coming from the beginning. And I’m an idiot. You should have seen it too.
— Jesse Kelly (@JesseKellyDC) March 26, 2020
And the 3.2 million number is likely underreporting things:
What I’ve been trying to explain. 3.2 million unemployed is LAST week’s number. Businesses are gonna run out of capital the longer it goes. Assuming this week the real # is 12 million, that means 20+ million unemployed by next week. And that’s conservative.
Economic devastation. https://t.co/pzPwoFwI6H
— Jesse Kelly (@JesseKellyDC) March 26, 2020
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There are thousands and thousands who couldn’t even file because of issues with state websites:
last week's number don't include people who couldn't file because the websites crashed, etc.
— Greg Pollowitz (@GPollowitz) March 26, 2020
And the number doesn’t take into account 1099 employees:
Nor does it include 1099 employees who aren’t eligible for unemployment. So this number will *never* count the gig economy workforce
— Bourbon For One (@bourbonforone) March 26, 2020
We don’t know how much bigger the number actually is, but we need to be ready for it to be a lot higher:
People need to understand this. The 3.2 million doesn’t even come CLOSE to reflecting how many are out of work. Many haven’t filed. Many aren’t even allowed to file. The real number is easily 3X that much. https://t.co/K62BnBG5EV
— Jesse Kelly (@JesseKellyDC) March 26, 2020
But don’t take our word for it. Here’s the NYT’s Ben Caselman: “As bad as they will be (and they will be catastrophically bad), they will NOT reflect the full scope of the problem”:
An important reminder about today's jobless claims figures: As bad as they will be (and they will be catastrophically bad), they will NOT reflect the full scope of the problem. The true number of lost jobs is significantly higher.
Three main reasons (thread):— Ben Casselman (@bencasselman) March 26, 2020
Now, soon-to-be-passed coronavirus stimulus bill should help some of these people:
For one thing, a lot of people don't qualify for unemployment benefits. Self-employed, gig workers, independent contracts don't qualify. Nor do many part-timers, recent hires or very low earners. (The Senate bill would change some of that, temporarily.)
— Ben Casselman (@bencasselman) March 26, 2020
But some people who do already qualify don’t know that they qualify:
Second, a lot of people who *do* qualify don't know it. I've heard people saying things like "I got furloughed not laid off so I can't get benefits." Many of those people almost certainly do qualify, but have gotten bad info (or in some cases been misled by employers).
— Ben Casselman (@bencasselman) March 26, 2020
As we mentioned above:
Third, the sudden flood of claims has overwhelmed state UI systems. There are tons of reports of jammed phone lines, overloaded servers and claimants who aren't able to file (I've spoken to several myself). Others may have heard those stories and decided not to bother trying.
— Ben Casselman (@bencasselman) March 26, 2020
In sum, this is the “lower bound”:
All of which means we should think of today's claims number as a lower bound for the number of people who lost jobs last week. And of course today's numbers won't tell us anything about people who lost jobs *this* week.
— Ben Casselman (@bencasselman) March 26, 2020
Bottom line: It will get worse:
We'll get a fuller picture eventually in the monthly jobs report, but not until May — the data in next week's jobs report was collected two weeks ago, before the worst of the layoffs.
— Ben Casselman (@bencasselman) March 26, 2020
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