The crisis caused by the coronavirus pandemic continued to hit the U.S. job market, where millions of more people, including many executives, called for state unemployment aid last week.
Initial applications for unemployment benefits totalled 2.981 million in seasonally adjusted figures in the week ended May 9, the Labor Department said Thursday.
Although the figure marks a decrease from the 3.176 million unemployment insurance orders of the previous week and represents the sixth consecutive drop, the volume of applications remains persistently high.
Economists polled by Reuters had forecast that orders would hit 2.5 million in the past week. The numbers have been gradually declining since hitting a record 6.867 million in the week to March 28.
The weekly report on unemployment benefits, one of the key data on economic health, supports analysts’ expectations of a third consecutive month of strong layoffs in May. The report was released a day after Federal Reserve Chairman Jerome Powell warned of an “extended period” of economic weakness and stagnant income due to the coronavirus epidemic.
“We are at the end of the first wave of layoffs, and we are now in a transition from the natural disaster phase to the recessive phase,” said Josh Wright, chief economist at Wrightside Advisors in New York.
“That is the reason why so many executive jobs are being lost. Indeed, a section of the economy was amputated and now we are going to be without that sector for quite some time,” he added.
The US economy lost the painful number of 20.5 million jobs in April, the biggest collapse in payrolls since the 1930s, as companies had to resort to orders to stop and confine workers due to the advance of the COVID-19.
In any case, April probably marked the majority of job losses from this crisis, which has also been marked by the largest drop in production since the Great Recession of 2007-2009.
In another economic report on Thursday, import prices in the United States suffered their biggest drop in more than five years in April, as the crisis depressed demand for oil products, which could support predictions of a short period of deflation.