By Dave Lindorff
Thursday morning the bottom fell out of the US economy, as the US Department of Labor reported that an unprecedented 6.6 million more workers in the US had been laid off and had filed claims for unemployment compensation payments with their state Unemployment Offices last week. That stunning news followed the already shocking news from last week that 3.3 million workers had lost their jobs and had filed for benefits the week before. This means that over the past two weeks, a total of 10 million workers — about 6.7% of the total US labor force — had filed for unemployment benefits in less than half a month.
But the news will get much worse tomorrow, when the Bureau of Labor Statistics releases its report on the March unemployment rate.
The number is bound to be appalling, since only a fraction of the US workforce is even covered by unemployment compensation insurance. Each state sets its own rules on which workers are eligible to be covered by the program and under normal circumstances, that ranges from a high of 50% of workers in Massachusetts to 10% of workers in North Carolina. The rest of the states fall somewhere in between, averaging at about a quarter of their workers being covered.
Currently, under a measure included in the $2.2-trillion pandemic stimulus bill just passed by Congress, eligibility for unemployment benefits has been expanded to include more workers who may not have worked enough quarters to qualify, and some gig workers who are normally not considered to be workers, but rather “independent contractors.” So let’s be generous and say that perhaps instead of the total number of workers being two times the number of “covered” workers in the US, it’s going to be “just” 50% of the total. That would still mean that if 10 million workers covered by unemployment insurance had filed for benefits over the past two weeks, actually 20 million works were just fired or laid off from their jobs during that same time span.
Now, prior to that, the official unemployment rate over the last six months, before the arrival of the COVID-19 Coronavirus on US shores, had been running at about 3.6%, or about 5.8 milling workers. So if that rate were to move to 10%, it would mean that now over 17 million workers are jobless.
And that’s based upon the so-called “official” U3 unemployment category used these days by the BLS — a deliberately misleading number that excludes anyone who is considered to be “not actively seeking employment,” (meaning they hadn’t actively applied for a job in four weeks). Basically, though, what is excluded from the statistic are people who are involuntarily only employed part time because of a lack of full-time jobs and people who want to work but after seeking a job for months unsuccessfully have given up the search. The U6 rate, often called the “real” rate, is typically double or more than double the U3 rate. So for example, in February, when the U3 unemployment rate was 3.6%, the U6 rate was 7.3% …
For the rest of this article by DAVE LINDORFF in ThisCantBeHappening!, the uncompromised, collectively run, six-time Project Censored Award-winning online alternative news site, please go to: https://thiscantbehappening.net/neither-pandemic-nor-economic-collapse-is-going-to-be-a-short-lived-crisis/