More than 5.2 million Americans filed for unemployment last week, according to the Department of Labor’s initial jobless claims report. While that number is historically astronomical—it’s more than 25 times the number of people who sought unemployment benefits a year ago—it’s nonetheless a significant improvement over the previous two weeks, in which more than 6.6 million and nearly 6.9 million people filed claims.
North Carolina had no such luck. Last week, 137,934 residents filed an initial jobless claim, almost exactly the same as the 137,422 who filed the week prior. Over the last four weeks—since Governor Cooper shut down restaurants and bars on March 17—about 540,000 people have filed for unemployment in the state.
As of February, the Bureau of Labor Statistics estimated that North Carolina’s entire labor force was about 5.1 million, including the 182,000, or 3.6 percent, who were unemployed. Ignoring the fact that North Carolina’s unemployment system is notoriously awful, and that roughly 90 percent of unemployed residents don’t have access to benefits, this means that North Carolina’s unemployment rate is somewhere in the ballpark of 14 percent.
In the four weeks since President Trump declared a state of emergency on March 13, more than 22 million Americans have sought unemployment benefits. For perspective, the U.S. added 22.8 million jobs from February 2010 to February 2020—the entire span of the recovery from the Great Recession. The unemployment rate, officially at 4.4 percent, is really at about 20 percent, and likely to remain in double digits through the end of the year.
At the height of the Great Depression in 1933, the unemployment rate hit 24.9 percent, the highest it’s ever been. The year before, GDP had contracted by nearly 13 percent.
This year, economists predict that GDP will contract by 30 percent in the second quarter and 5 percent throughout 2020. The bounceback toward the end of the year, however, relies on the success of the rescue bill Congress passed in late March, which has already run into some hiccups.
On Thursday, the White House announced that $349 billion in funding for the Paycheck Protection Program had run out. Republican efforts to add another $250 million to the program have run into Democratic demands for additional support for cash-strapped states and cities, hospitals, and food-stamp recipients. Democrats say Republicans refuse to negotiate even as governors are seeking $500 billion in stabilization funds.
The Economic Injury Disaster Loan program is also running out of money, which has led Small Business Administration officials to dramatically lower to amount of money it is doling out. The stimulus bill included $10 billion for an SBA grant program, in which the agency was directed to give $10,000 to small businesses that applied for low-interest loans of up to $2 million within three days of the application.
As of Wednesday, about half of small businesses applied for an EIDL loan and grant as of April 9, according to the National Federation of Independent Business. The program had $7.3 billion allocated for $372 billion in applications, The Washington Post reported. With demand crushing the system, those “quick” payments have been delayed for weeks, and the SBA has changed the grant amount from $10,000 to $1,000 per employee.
Contact editor in chief Jeffrey C. Billman at jbillman@indyweek.com.
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