Yesterday we saw the US initial jobless claims jump by a seasonally adjusted 6.65 million as Americans began to apply for unemployment benefits after countless businesses were forced to either close or scale back hours. To put the figure into perspective, in the last 2 weeks, new claimants have easily exceeded the height of those that collected benefits during the 2007-2009 recession. The then record of 6.6 million people drew benefits at the tail end of the recession. And it does not end there. The newly unemployed are very likely to continue to grow to surpass the prior record of 15.3 million, set during the Great Recession. There have been numerous predictions that the number of Americans who lose their job over the next few months could be as high as 25 million, even if only for a limited time.
This afternoon we had March’s Non-Farm Payroll numbers. The market consensus was going for a minus 100,000 figure, breaking 113 consecutive months of payroll gains. The actual number of jobs lost came in at a massive 701,000 with the previous month’s figure revised up to 275,000 added. The unemployment rate increased to 4.4% versus the prior month’s reading of 3.5% and the participation rate fell to 62.7% from last month's 63.4%. Plus, due to the way the payrolls are calculated, the figure would have been even worse. This is because workers need to be unemployed for the entire pay period containing the 12th of the month to be counted as a lost payroll, so the figure was even before government-mandated shutdowns went into widespread effect.