- Last week, a staggering 3.28 million people applied for unemployment in the United States.
- The number beats the previous 1982 record and weekly claims during the 2008 Recession by millions.
- However, economists say the new wildly high unemployment numbers are more akin to what is seen in times of natural disaster rather than “typical recessions.”
- In an extremely rare televised interview, Federal Reserve Chair said the economy may already be in a recession, but he appeared optimistic that the country could possibly bounce back quickly once the virus is under control and businesses reopen.
Unemployment Claims All-Time High
More than 3.28 million people filed unemployment claims last week, according to the Labor Department.
The number is a stunning indication of just how rapidly and how extensively businesses like restaurants, hotels, gyms, movie theaters, etc. have shut down as the COVID-19 pandemic batters the United States.
By contrast, this new number shattered the previous record (695,000 claims in 1982) for the highest number of unemployment claims filed in a single week. It also greatly surpassed any week of the 2008 Recession, which capped at 665,000 during a single week.
However, comparing the coronavirus’ economic impacts to “typical” recessions isn’t quite accurate. This is because those recessions generally play out over a series of months or years.
For instance, while the 2008 Recession never saw weekly unemployment hit the millions, unemployment was higher than average for five years. In fact, if you added together all of the weeks of above-average unemployment, you’d get a total of about 26 million claims filed.
With the coronavirus, however, while the U.S. might see extremely high unemployment rates, many economists only expect it to last for a matter of weeks. Since the two circumstances are so wildly different, that can also make it difficult to use “typical” recessions to predict what will happen in the U.S. economy even a month or two from now.
Still, many economists predict that unemployment could climb as high as 40 million people by April, so while it may not be like “typical” recessions, this already is and will likely continue to affect millions of people.
On top of that, many trying to file for unemployment have recounted horror stories of websites crashing and being on hold for hours, many only to be told once they finally reach someone that they don’t qualify.
Treating the Coronavirus Like a Natural Disaster
Many economists are telling people to view the coronavirus pandemic less like the 2008 financial crisis and more like a natural disaster, which can cause the immediate shutdown of an entire economic region.
One big example is Louisiana and Hurricane Katrina. On average, about 4,000 unemployment claims are filed each week in Louisiana. When Katrina hit in 2005, there was a massive, yet momentary spike in unemployment claims.
That spike is similar to the nearly 73,000 people who filed unemployment claims in Louisiana last week. Of course, now, it’s not just Louisiana that’s experiencing a rapid surge in unemployment.
Just about every state in the country has seen a significant rise, with states like California, Massachusetts, Michigan, New Jersey, Ohio, and Texas all boasting some of the largest numbers. It should be noted, however, that these are all highly populated states and the average unemployment rate for each state varies.
- Weekly Average: 52,200
- Claims Filed Last Week: 186,809
- Weekly Average: 8,000
- Claims Filed Last Week: 147,995
- Weekly Average: 15,000
- Claims Filed Last Week: 129,298
- New Jersey
- Weekly Average: 11,000
- Claims Filed Last Week: 155,454
- Weekly Average: 187,784
- Claims Filed Last Week: 13,000
- Weekly Average: 16,900
- Claims Filed Last Week: 155,657
By far, the biggest spike in unemployment claims was in Pennsylvania, where nearly 380,000 people filed for unemployment. That’s up from an average weekly filing of 21,000 claims.
Are We In A Recession?
Thursday morning, in an extremely rare televised interview, Jerome Powell, Chair of the Federal Reserve, spoke with Savannah Guthrie on The TODAY Show. Prompted by a question from Guthrie, Powell said the country “may well be in a recession.”
“But I would point to the difference between this and a normal recession,” he added. “There is nothing fundamentally wrong with our economy. Quite the contrary. The economy performed very well, right, through February. We’ve got a fifty year low in unemployment in the last couple of years, so we start in a very strong position.”
“This isn’t something that’s wrong with the economy. This is a situation where people are being asked to step back from economic activity, close their businesses, stay home from work, so in principle, if we get the virus spread under control fairly quickly, then economic activity can resume. ”
Powell went on to say that once the country is able to get this virus under control, it could see that rebound. Notably, Powell also stressed that it is still unknown how quickly that could happen.
One of the biggest ways the government is trying to hold up the economy is through a $2 trillion dollar stimulus package. Wednesday night, the Senate unanimously passed that 96-0. It now goes to the House, which is expected to vote on it tomorrow morning.
If it passes without any revisions, it would then head directly to President Trump, who’s said he would sign it immediately.
News of the bill’s passage through the Senate led to favorable reactions in the stock market. Between that news and the announcement that Senate Democrats and Republicans were working with the White House to make such a deal, both the Dow Jones and the S&P 500 posted their first back-to-back gains for the first time since February.
In February, the Dow was posting an all-time high of 29,000. By Monday, when Senate Democrats shot down a previous version of the stimulus package, the Dow Jones had sunk to 18,000 points. Notably, it hadn’t been that low since 2016.
By Thursday morning, the Dow was back up to 22,000 points.
See what others are saying: (The New York Times) (The Wall Street Journal) (CNN)
Medical Workers Sign Letter Urging Spotify to Combat Misinformation, Citing Joe Rogan
The letter accused Spotify of “enabling its hosted media to damage public trust in scientific research.”
Doctors and Medical Professionals Sign Letter to Spotify
A group of 270 doctors, scientists, and other medical workers signed an open letter to Spotify this week urging the audio platform to implement a misinformation policy, specifically citing false claims made on the “Joe Rogan Experience” podcast.
Rogan has faced no shortage of backlash over the last year for promoting vaccine misinformation on his show, which airs exclusively on Spotify. Most recently, he invited Dr. Robert Malone on a Dec. 31 episode that has since been widely criticized by health experts.
Dr. Malone was banned from Twitter for promoting COVID-19 misinformation. According to the medical experts who signed the letter, he “used the JRE platform to further promote numerous baseless claims, including several falsehoods about COVID-19 vaccines and an unfounded theory that societal leaders have ‘hypnotized’ the public.”
“Notably, Dr. Malone is one of two recent JRE guests who has compared pandemic policies to the Holocaust,” the letter continued. “These actions are not only objectionable and offensive, but also medically and culturally dangerous.”
Joe Rogan’s History of COVID-19 Misinformation
Rogan sparked swift criticism himself in the spring of 2021 when he discouraged young people from taking the COVID-19 vaccine. He also falsely equated mRNA vaccines to “gene therapy” and incorrectly stated that vaccines cause super mutations of the virus. He took ivermectin after testing positive for the virus in September, despite the fact that the drug is not approved as a treatment for COVID.
“By allowing the propagation of false and societally harmful assertions, Spotify is enabling its hosted media to damage public trust in scientific research and sow doubt in the credibility of data-driven guidance offered by medical professionals,” the doctors and medical workers wrote.
“We are calling on Spotify to take action against the mass-misinformation events which continue to occur on its platform,” they continued. “With an estimated 11 million listeners per episode, JRE is the world’s largest podcast and has tremendous influence. Though Spotify has a responsibility to mitigate the spread of misinformation on its platform, the company presently has no misinformation policy.”
Rolling Stone was the first outlet to report on the letter from the medical professionals. Dr. Katrine Wallace, an epidemiologist at the University of Illinois Chicago, was among the signees. She told the magazine that Rogan is “a menace to public health.”
“These are fringe ideas not backed in science, and having it on a huge platform makes it seem there are two sides to this issue,” she said. “And there are really not.”
Spotify had not responded to the letter as of Thursday.
See what others are saying: (Rolling Stone) (Deadline) (Insider)
Data Shows Omicron May be Peaking in the U.S.
In some cities that were first hit by the surge, new cases are starting to flatten and decline.
New Cases Flattening
After weeks of recording-breaking cases driven by the highly infectious omicron variant, public health officials say that new COVID infections seem to be slowing in the parts of the country that were hit the hardest earlier on.
Following a more than twentyfold rise in December, cases in New York City have flattened out in recent days.
New infections have even begun to fall slightly in some states, like Maryland and New Jersey. In Boston, the levels of COVID in wastewater — which has been a top indicator of case trends in the past — have dropped by nearly 40% since the first of the year.
Overall, federal data has shown a steep decline in COVID-related emergency room visits in the Northeast, and the rest of the country appears to be following a similar track.
Data from other countries signals the potential for a steep decline in cases following the swift and unprecedented surge.
According to figures from South Africa, where the variant was first detected, cases rose at an incredibly shocking rate for about a month but peaked quickly in mid-December. Since then, new infections have plummeted by around 70%.
In the U.K., which has typically been a map for how U.S. cases will trend, infections are also beginning to fall after peaking around New Year’s and then flattening for about a week.
Despite these recent trends, experts say it is still too early to say if cases in the U.S. will decline as rapidly as they did in South Africa and the parts of the U.K. that were first hit.
While new infections may seem to be peaking in the cities that saw the first surges, caseloads continue to climb in most parts of the country.
Meanwhile, hospitals are overwhelmed and health resources are still strained because of the high volume of cases hitting all at once.
See what others are saying: (The New York Times) (The Washington Post) (The Wall Street Journal)
COVID-Driven School Closures Top Record Highs, But Many Remain Open
While some districts have implemented protective measures, many teachers say they fall short.
Schools Respond to Omicron Surge
U.S. COVID cases, driven by the omicron variant, are continuously topping new record highs, posing difficult questions for schools resuming after winter break.
According to Burbio, a data firm that tracks school closures, at least 5,409 public schools canceled classes or moved to remote learning by the end of last week due to COVID — more than triple the number at the end of December.
That is still only a fraction of the nation’s 130,000 schools, and many of the biggest school districts in the country are still insisting that students come into the classroom.
Los Angeles, which is home to the second-biggest district, is requiring that students at least test negative before they return to school this week.
In the biggest district of New York City, classes have already resumed following winter break. Although the city has said it will double random tests and send home more kits, students were not required to provide negative results.
Teachers Protest In-Person Learning
Teachers in other major districts have protested the local government’s decisions to stay open.
One of the most closely watched battles is in Chicago, where students on Monday missed their fourth consecutive day of school due to a feud between the Chicago Teachers Union and Mayor Lori Lightfoot (D).
Last week, the union voted to return to remote learning in defiance of a city-wide order mandating they teach in-person, citing inadequate COVID-19 protections. Lightfoot claimed the conditions were fine and that students were safe, despite record surges, instead opting to cancel classes altogether while the fight plays out.
On Sunday, the union said it was “still far apart” from making any kind of agreement with public school officials after Lightfoot rejected their demands.
Lightfoot, for her part, has said she remains “hopeful” a deal could be reached, but she also stirred up the union by accusing teachers of staging an “illegal walkout” and claiming they “abandoned their posts and they abandoned kids and their families.”
Meanwhile, teachers in other school districts have begun to emulate the tactics in Chicago.
On Friday, teachers in Oakland, California staged a “sick-out,” promoting 12 schools serving thousands of students to close.