Unprecedented jobless claims "could persist for a while," expert says
The unprecedented number of Americans who filed for unemployment benefits last week is likely to continue as the country grapples with the coronavirus pandemic, CBS News business analyst Jill Schlesinger said Thursday. Nearly 3.3 million people filed for benefits, the most in 50 years.
"This is the first week where we're seeing claims jump, in such a big way," Schlesinger said on "CBS This Morning." "I think, unfortunately, we are going to see subsequent weeks follow on to this. This could persist for a while."
The new number is well beyond the number of claims after the 2008 financial crisis, Schlesinger said.
"We saw the peak of layoffs, weekly claims in 2008, 2009 — we never got beyond 700,000. This is the highest number by a magnitude of four or five times," she said.
Nonessential businesses across the country have been ordered to shut down as part of the effort to stop the spread of coronavirus.
"A health pandemic has become a financial pandemic," Schlesinger said.
She described the $2 trillion relief package passed by the Senate Wednesday night, which includes direct payments of $1,200 to most Americans making up to $75,000 and $367 billion in loans for small businesses, as "a lifeline."
"I got a lot of people who responded to me and said, 'I need that lifeline,' and what we're learning now, is more than 3 million people are in need of those enhanced unemployment benefits, that extra $600 a week," she said. "We need our small businesses to stay in business. So, we've got to see this money flow to those businesses as quickly as possible."
There is concern about how quickly the benefits will get to people, Schlesinger said.
"I think that the issue right now is that the unemployment benefits at the states have been clogged up," she said. "Hopefully, the federal government sending money to states is going to help beef up that process."
Schlesinger said she's more concerned about people getting the $1,200 checks from the federal government.
"Unless you have direct deposit on account with the Treasury Department, the IRS, it could take up to a few, maybe four months," she said. "If you always got your tax refund through direct deposit, it's going to be a few weeks."
Some companies have put out calls to hire new workers, but there are many more people unemployed than jobs available.
"We've heard Instacart announce 300,000 jobs, we heard Walmart, 150,000, Amazon,100,000. CVS, Walgreens, but I tried to do a back-of-the-envelope calculation yesterday of all of the announcements, and it's about, let's say 800,000 or 900,000 jobs," Schlesinger said. "We have more than three times as many as those numbers of new jobs who are on unemployment right now."