Weekly Jobless Claims Unexpectedly Spike, Asian-Americans Most Affected by Long-Term Unemployment
The weekly number of unemployment claims increased again, defeating economists’ expectations they would continue their downward trend.
For the week ending March 13 the weekly number of unemployment claims rose to 770,000, an increase of 45,000 from the previous week’s level, according to the Labor Department.
The previous week’s level was revised up by 13,000 from 712,000 to725,000.
Economists expected 700,000 workers to file for initial unemployment benefits last week, according to The Wall Street Journal.
To put these figures in context, pre-pandemic, first-time unemployment benefit filers had typically numbered only about 225,000 weekly. For example, for the week ending Feb. 29, 2020, the figure stood at 217,000 claims, according to Labor Department data.
Fed Chairman Jerome Powell, when announcing the Fed would not raise rates until 2023 yesterday, said that the economic recovery will depend on the course of the virus.
“The economic fallout has been real and widespread,” Fed chairman Jerome Powell said in the press conference following the FOMC meeting. But, he added, “Some of the very worst economic outcomes have been avoided by swift actions.”
According to a Fed statement “the COVID-19 pandemic is causing tremendous human and economic hardship across the United States and around the world. Following a moderation in the pace of the recovery, indicators of economic activity and employment have turned up recently, although the sectors most adversely affected by the pandemic remain weak. Inflation continues to run below 2%.”
In terms of long-term unemployment, a Pew Research Center analysis found that it rose more sharply among Asian American workers who are unemployed. In the fourth quarter of 2020, nearly half of unemployed Asian workers (46%) had been out of work for more than six months, compared with 21% in the fourth quarter of 2019.
Black unemployed workers had the next highest long-term unemployment rate (38%) at the end of 2020, followed by White (35%) and Hispanic (34%) unemployed workers. For these three groups of unemployed workers, the long-term unemployment rate was around 15 percentage points higher than one year earlier, Pew Research says.
“These patterns differ from the percent of all workers who are unemployed regardless of duration. Black workers (9.8%) had the highest unemployment rate overall in the fourth quarter of 2020, followed by Hispanic (8.7%), Asian (6.3%) and White workers (5.1%),” according to the analysis.
The reason for the relatively high long-term unemployment rate among Asian unemployed workers is not entirely clear, the analysis says, adding that it may be partially explained by the fact that they tend to be disproportionately represented in states most impacted by coronavirus shutdowns. “Nearly a third of Asian Americans (31%) lived in California in 2019, a state that had some of the longest shutdowns and most severe outbreaks in 2020. New York is the state with the second largest share of the Asian population (9%) and suffered the third most employment losses since the start of the pandemic,” according to the report.
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