Former Federal Reserve Chair Janet Yellen said Monday the real unemployment level could be far higher than officially recorded as she warned of a depression.
Yellen told CNBC second-quarter GDP could decline by 30 per cent and unemployment is already at 12 per cent and 13 per cent amid the coronavirus outbreak.
She warned the downturn is ‘absolutely shocking’, adding: ‘If we had a timely unemployment statistic, the unemployment rate probably would be up to 12 or 13% at this point and moving higher.’
With a labor forced of 165 million that means up to 21 million Americans unemployed by Yellen’s calculations.
Yellen said: ‘This is a huge, unprecedented, devastating hit, and my hope is that we will get back to business as quickly as possible.’
On whether the economy can recover quickly with a sudden ‘V’ upturn, she warned: ‘I think a ‘V’ is possible, but I am worried that the outcome will be worse and it really depend to my mind on just how much damage is down during the time that the economy is shut down in the way it is now.
‘The more damage of that sort is done, the more likely we are to see a ‘U,’ and there are worse letters like ‘L’ and I hope we don’t see something like that.’
Former Federal Reserve Chair Janet Yellen, pictured, said second-quarter GDP could decline by 30 per cent and unemployment is already at between 12 per cent and 13 per cent
More than 6.6 million Americans filed for unemployment benefits last week, according to new figures released by the Department of Labor on Thursday. About 50 people lined up (above) outside an Arkansas unemployment office on Monday
The number of Americans officially filing new claims for unemployment benefits last week has shot to a record 6.6 million – as layoffs increased amid the coronavirus pandemic and more states enforced stay-at-home orders.
New claims for unemployment benefits rose to 6.65 million in the week ending March 28, according to figures released by the Department of Labor on Thursday.
The number of first-time applications for jobless benefits was double the previous record of 3.3 million new claims filed for the week ending March 21.
It means that roughly 10 million Americans have lost their jobs and filed for unemployment in the two weeks that the coronavirus started rapidly spreading across the country.
In the same week of last year, only 211,000 people requested benefits for the first time.
The new unemployment claims account for the week in which states like New York shuttered non-essential businesses and enforced stay-at-home orders.
New claims for unemployment benefits rose to 6.65 million in the latest week from the 3.3 million the previous week. It means that 10 million Americans have filed for unemployment in the two weeks that the coronavirus started rapidly spreading across the country
New claims for unemployment benefits rose to 6.65 million in the week ending March 28. In the same week of last year, only 211,000 people requested benefits for the first time
The number of Americans filing new claims for unemployment benefits last week has shot to a record 6.6 million, according to figures released by the Department of Labor on Thursday
Walt Disney Co. officials announced they will start furloughing some workers in two weeks at its theme parks resorts in Florida and California.
The statement released late Thursday from The Walt Disney Co. said the first wave of furloughs will start April 19 and involve workers whose jobs aren’t necessary at this time. Anyone who is furloughed will remain a Disney employee, the company said.
SeaWorld Entertainment said it was furloughing 90 per cent of its workers because the novel coronavirus had forced the company to close its 12 theme parks.
Florida’s Sarasota Memorial Hospital with 34 coronavirus patients in its 839-bed facility said it was furloughng staff after a $16 million decline in revenue amid the pandemic.
‘This was an extremely difficult decision, and one that we did not make lightly,’ CEO David Verinder said.
Macy’s, Kohl’s and Gap Inc. all said last week they will stop paying tens of thousands of employees who were thrown out of work when the chains temporarily closed their stores and sales collapsed as a result of the pandemic.
Macy’s said the majority of its 125,000 employees will be furloughed and that it is transitioning to an ‘absolute minimum workforce’ needed to maintain basic operations.
The retail giant said it has lost the bulk of its sales due to the temporarily closing of more than 600 stores starting March 18.
Kohl’s, based in Menomonee Falls, Wisconsin, said that the furloughs will apply to 85,000 of its 120,000 employees at stores and distribution centers. It will continue to ship products and do curbside pickup from most stores with a limited number of staff.
Gap’s spokesman Sandy Goldberg said the furloughs affect nearly 80,000 out of 129,000 employees across all brands, including Banana Republic and Old Navy.
The furloughed workers will continue to collect health benefits.
Whirlpool Corp. asked its workers to take two weeks of unpaid leave.
The company said: ‘We continue to take proactive measures to mitigate the economic impact of this global pandemic.
‘We believe these short-term actions will further enable our company, and our employees, to weather this storm and continue to serve our consumers as we have been doing for 108 years.’
Unemployment In US surged to a record 6.6. Millions americans filing for benefits under COVID-19-related layoffs. A man reads a sign on the door of the New York State Department of Labor offices in the New York City borough of Queens on April 2
People wait in line for help with unemployment benefits in Las Vegas
Unionized hospitality workers wait in line in a basement garage to apply for unemployment benefits at the Hospitality Training Academy in Los Angeles
It’s bad news for an economy in which the retail industry supports one out of four workers.
It is also perhaps the most dramatic sign that even big name retailers are seeing their business evaporate and that the $2 trillion rescue package passed by Congress and signed by President Donald Trump may have limited impact.
Nordstrom said last week it was furloughing a portion of its corporate staff. And shoe company Designer Brands Inc., which operates DSW Designer Shoe Warehouse, furloughed 80 per cent of its workers, effective this past weekend.
American Eagle Outfitters Inc. also announced temporary furloughs of its store, field and corporate employees from Sunday.
Analysts expect more furloughs to come as retailers scramble to pay their employees from fast-dwindling cash reserves. Labor is the single biggest monthly fixed cost for retailers, according to investment research firm Cowen & Co.
The furlough of workers will have negative consequences for an economy in which the retail industry supports one out of four workers.
‘This could push us further into a damaging recession that will last longer than the duration of the crisis,’ said Neil Saunders, managing director of GlobalData Retail.
More than 190,000 stores, including J.C. Penney and Neiman Marcus, have temporarily closed, accounting for nearly 50% of the U.S. retail square footage, according to Saunders.
Discounters, grocers and wholesale clubs that sell essential items like groceries remain open, although they have their own challenges of keeping up with shoppers who continue to stockpile canned goods, paper towels and other staples.
When announcing the temporary closures, most retailers said they would keep paying their workers but they were looking at a two-week timetable. That moment has now passed and the furloughs have become increasingly necessary as the coronavirus rapidly spreads.
The big question is how much of these furloughs will lead to permanent layoffs.
Rent the Runway, a pioneer in fashion rental, confirmed earlier Monday, that it was laying off its retail store staff and said it may not be able to reopen its stores that temporarily shuttered earlier this month. Its online subscription service still continues to operate.
Swedish retailer H&M said earlier this month that it may be forced to permanently layoff some its employees after temporarily shuttering 3,441 of its 5,062 stores globally.
Coresight Research’s Deborah Weinswig now forecasts a new record high of 15,000 stores will close this year, up from her original prediction of 8,000 — all because of the viral outbreak.
About 90 percent of Americans are now under some form of lockdown – up from less than 50 percent just a few weeks ago – as the death toll rose to 5,647 as more than 236,086 Americans have tested positive for the virus.
All 50 states reported rises in new unemployment claims, according to the report, with Pennsylvania (up 362,012), Ohio (up 189,263) and Massachusetts (up 141,003) reporting the largest increases.
In New York, 370,000 people filed new claims last week – an increase of 2,674 percent compared to last year.
Meanwhile, in California nearly 900,000 people sought benefits last week, almost four times the previous week’s figure, and equivalent to 5 percent of the state’s workforce.
In Michigan, jobless claims more than doubled last week to 311,000. In Florida, filings tripled to 227,000. In South Dakota, they quadrupled to 6,645.
‘You should be ashamed of yourself’ Striking Amazon staff shout at cops clearing them off the picket line as construction workers and McDonald’s employees also walkout
Workers manning the frontlines amid worldwide coronavirus lockdowns continue to strike across the United States.
Staff at an Amazon delivery facility in Chicago, Illinois protested Saturday, looking for more protections as they work. Police who broke up the vehicular picket were told they should be ‘ashamed’ of themselves, Patch.com reports.
In Massachusetts 10,000 construction workers plan to strike Monday. ‘Nothing we’ve seen has been able to ensure the safety of our members, or workers at other sites’, Union executive Tom Flynn said.
And in California McDonald’s staff walked out after their colleague contracted the virus – but say bosses did not tell them.
Staff at an Amazon delivery facility in Chicago, Illinois protested Saturday, looking for more protections as they work. Police who broke up the vehicular picket were told they should be ‘ashamed’ of themselves, Patch.com reports
Cook Bartolome Perez told City News Service: ‘We’ve been pleading for protective equipment for more than a month now, but McDonald’s is putting its profits ahead of our health. We don’t want to die for McDonald’s burgers and fries.’
Grocery workers – many in low-wage jobs – are manning the frontlines amid worldwide lockdowns, their work deemed essential to keep food and critical goods flowing.
They are insisting employers pay them more and provide masks, gloves, gowns and access to testing.
In a handful of states – Minnesota and Vermont were the first – have given grocery workers a special classification that allows them to put their children in state-paid child care while they work.
Unions in Colorado, Alaska, Texas and many other states are pressing governors to elevate grocery workers to the status of first responders.
‘The government’s responsibility is to step up in these moments,’ said Sarah Cherin, chief of staff for the United Food and Commercial Workers International Union in Seattle, the first U.S. epicenter of COVID-19.
The workers are demanding a two-week quarantine period, with full pay for a co-worker who tested positive for COVID-19
The union, which represents about 23,000 grocery workers and 18,000 health care workers, won early concessions for higher pay.
‘We have always been a group of people who come to work when others stay home,’ Cherin said. ‘Our workers need the same protection others get.’
Whole Foods workers called for a recent ‘sickout’ to demand better conditions, including double pay.
A group of independent contractors for the Instacart grocery delivery service walked out to force more protections.