The Corner

Economy & Business

The Economic Crisis Has Officially Arrived

A pedestrian walks on Wall Street in front of the New York Stock Exchange as concerns about the coronavirus keep more people at home in New York City, March 18, 2020. (Lucas Jackson/Reuters)

The first piece of real, hard data indicating deep economic trouble from COVID-19 arrived this morning.

Initial filings for unemployment insurance benefits shattered its previous record. We found out this morning that 3.3 million new UI claims were filed last week. The previous record, in 1982, was 695,000.

The chart in the tweet above shows this series over time, and does not include today’s numbers to give you a sense of what this series normally looks like.

In response to mandates by state and local governments for people to stay home and businesses to shut, employers have been laying off their workers at astonishing levels. As of yesterday morning, at least 163 million people in 17 states and eight cities were being told to shelter in place. That’s half of the U.S. population — and growing. Today’s numbers show the damage that is doing to the labor market.

Expect the unemployment rate to spike and the rate of economic growth to fall well below zero this spring.

The economic crisis has officially arrived.

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