Tag Archives: Unemployment

The 21st Century Is Marked By Crisis and Political Division, by Bill Bonner

We’re twenty percent into the 21st century and it hasn’t been a great start. From Bill Bonner at rogueeconomics.com:

Week 26 of the Quarantine

In this bright future, you can’t forget your past.

– Bob Marley

SAN MARTIN, ARGENTINA – What a colossal flop!

We’re talking about the 21st century. A failure in almost every way.

We now have 30 million people on unemployment – nearly 20% of the labor force.

We have a budget deficit of nearly 20% of GDP.

And, despite already spending $2 for every $1 they collect in taxes, the feds are planning to spend more.

We have phony “conservatives” waving the flag… and real radicals trying to tear it down. On both sides are more and more loonies, locked and loaded…

Even many of our own dear readers are ready to go to war with each other. This is from yesterday’s mailbag:

Hey Dude, we are at WAR! Trump leads the Win-the-War Party! The Neo Repubs are the “What? Me, worry?” Party. And you are like the pet dog nipping at the heels of the soldiers marching past!

No matter the cost, we must win the war against socialism and the Ds. There is time enough to purify ourselves after we win! If we lose, it will be a “thousand years” before our experiment is tried again… Meanwhile it is your obligation to support those who are fighting, regardless of technique and strategy… TRUMP!

Nasty Themes

It is hard to figure out how an administration that declares a moratorium on rent collection, stifles free trade, and runs a deficit of 20% of GDP could save us from socialism… But in this great 21st-century future, wonders never cease.

This week, in this “new normal,” we’ve been trying to remember what the “old normal” was like. And was it really better? Or is it just us?

We recalled what it must have been like when we were born. Of course, it was a very different world back then.

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COVID Financial Pain ‘Much, Much Worse’ Than Expected, Warns Harvard Study, by Tyler Durden

Some of us expected Covid’s financial pain to be very bad indeed, but that certainly wasn’t the mainstream media line. From Tyler Durden at zerohedge.com:

New findings from a survey by the Robert Wood Johnson Foundation and the Harvard T.H. Chan School of Public Health, published by NPR News on Wednesday, reveal low-income minority households have experienced the most financial hardships in the virus-induced recession.

The pandemic heavily impacted Black and Latino households across America’s four largest cities (New York, Los Angeles, Chicago, and Houston) with massive job loss or reduction in hourly wages or a decline in working hours.

The survey, conducted from July 1 through Aug. 3, found Latino households (77%) and Black households (81%) in the Greater Houston area incurred “serious” financial problems.

Houston

As for the three other major cities, the survey showed 73% of Latinos in New York City experienced severe financial hardships, 71% of Latinos in Los Angeles, and 63% in Chicago. Black households in New York City (62%), Los Angeles (52%), and Chicago (69%) also reported severe financial distress because of the downturn.

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17 Facts That Prove The U.S. Economy Is A Complete And Total Disaster Zone At This Point, by Michael Snyder

On the surface the US economy looks shaky, propped up with trillions of dollars in funny money. Beneath the surface, it’s far worse. From Michael Snyder at theeconomiccollapseblog.com:

If you know people that actually believe that the U.S. economy is moving in a positive direction, just show them this article.  In all the years that I have been writing about the economy, I have never seen anything that even comes close to what we are experiencing now.  More than 100,000 businesses have permanently failed, and tens of millions of Americans have lost their jobs.  If you still have a good job you should cling to it with all of your might, because there are so many families that have no idea how they are going to pay the bills next month, or the month after that, or that month after that.  When it gets to the point where you can’t even pay the rent or the mortgage, financial worries can absolutely consume your life.  If you have been there, you know exactly what I am talking about.  And if you have children, that just makes things even worse.  How do you explain to them that “home” is no longer “home”?

Another group of people that I feel really badly for are all the business owners that have had their dreams absolutely shattered.  Starting a small business from nothing and building it into a success takes a massive amount of work, and I have a tremendous amount of respect for anyone that is able to do that.

Unfortunately, so many once thriving small businesses have now been destroyed by the events of 2020.  For a lot of those small business owners, it isn’t just time and energy that have been lost.  When you make your small business your passion, it becomes a part of who you are, and a lot of small business owners will never be the same again after this.

So please keep in mind that there are real people and real dreams behind each of the numbers that I am about to share with you.  The following are 17 facts that prove the U.S. economy is a complete and total disaster zone at this point…

#1 According to the San Francisco Chamber of Commerce, more than half of all the storefronts in the entire city of San Francisco are no longer in business.

#2 Just a few hours ago, New York City reported that it had an unemployment rate of almost 20 percent during the month of July.

#3 Speaking of New York, 83 percent of all restaurants in the city were unable to pay their full rent last month.

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Is Covid Coming For Your Job? by Adam Taggart

The flip side of coronavirus overreaction: an economy headed down the drain. From Adam Taggart at peakprosperity.com:

Laid off or fear you could be? Then read this.

Because despite the “Everything is Awesome!” mirage the financial markets are desperate to project, the real economy — you know, where people actually live their lives — is telling us a far darker story.

Tens of millions of US workers have lost their jobs since covid-19 arrived on America’s shores. Over 28 million people right now are currently filing to receive state & federal unemployment benefits:

Continued Claims chart

And despite extraordinary measures to aid these impacted households, many are slipping into hardship as the prospects only grow dimmer.

The $2.2 trillion CARES Act created the Federal Pandemic Unemployment Compensation program which added an additional $600 per week to those receiving unemployment benefits. It also sent a tax credit check of up to $1,200 ($2,400 for joint filers) to households making under a certain income threshold.

But the extra $600 payments have now expired, and Congress is deadlocked on what will follow. The current proposal is to re-start the extra benefit payment at the reduced sum of $400/week, with $300 paid out of the federal government’s Disaster Relief Fund and the rest funded by the individual states. Another $1,200 payment seems likely, as well.

This plan has it challenges, though. At $300/week, the Disaster Relief Fund will be drained after 5 weeks. And many states are claiming they can’t afford to foot the $100/week bill they’re being asked to.

So it’s little wonder, with tens of millions of jobs lost and over 3,500 businesses declaring Chapter 11 bankruptcy so far this year, Americans are increasingly worried for the future:

POLL-Three of ten Americans laid off in coronavirus crisis worried about food, shelter (Reuters)

Three of 10 Americans who lost work during the coronavirus pandemic said they may have trouble paying for food or housing after a $600-per-week enhanced unemployment payment expired last month, according to a Reuters/Ipsos poll released on Wednesday(…)

(…) Three out of 10 people surveyed by Reuters/Ipsos reported that they will have “a very difficult time meeting basic needs,” which includes paying for rent or buying groceries. Half said they are under some stress “but we will be able to meet our basic needs.”

And it’s only going to get harder for these folks from here.

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We Are Experiencing Economic Devastation On A Scale That America Has Never Seen Before, by Michael Snyder

Unfortunately, Michael Snyder is not exaggerating. From Snyder at themostimportantnews.com:

For a very long time we have been warned that a U.S. economic collapse was inevitably coming, and now it is here.  Fear of COVID-19 and unprecedented civil unrest in our major cities have combined to plunge us into a historic economic downturn, and nobody is exactly sure what is going to happen next.  On Thursday, we learned that U.S. GDP was down 32.9 percent on an annualized basis last quarter.  That officially makes last quarter the worst quarter in all of U.S. history, and many people believe that this new economic depression is just getting started.  But of course not all areas of the country are being affected equally.  According to USA Today, states such as Hawaii, Nevada, Michigan and New York were hit particularly hard last quarter…

Every state was walloped last quarter, though ones that rely heavily on travel and tourism, such as Hawaii and Nevada, were hit hardest by the downturn, according to employment figures analyzed by economist Adam Kamins of Moody’s Analytics. Michigan, the heart of the nation’s auto industry, was slammed as consumers put off car purchases. And densely populated Northeast states struck by the most severe virus outbreaks – like New York, New Jersey and Massachusetts – absorbed among the heaviest economic losses as governors shut down earlier and residents stayed home.

Originally, the mainstream media was telling us that the U.S. economy would come surging back to life during the third quarter, but we continue to get more signs that indicate that the economy is starting to slow down again.

For example, the Labor Department just released some new numbers that were more than just a little bit startling.  If you can believe it, another 1.434 million Americans filed new claims for unemployment benefits last week.  That was an increase over last week’s revised number, and it represents the second week in a row that initial claims have risen.

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The Numbers Tell Us That The ‘Economic Recovery’ Is Dead And Businesses Are Failing At A Staggering Pace, by Michael Snyder

Notwithstanding Wall Street’s fervid illusions and delusions, the economy is not bouncing back anytime soon. From Michael Snyder at themostimportantnews.com:

Even though economic conditions were absolutely awful, during the month of June the mainstream media kept insisting that the U.S. economy was “recovering” and the stock market kept surging on every hint of good news.  But now the “economic recovery” narrative is completely dead, because the numbers clearly show that the U.S. economy is rapidly moving in the wrong direction.  On Thursday, the Labor Department announced that another 1.416 million Americans filed new claims for unemployment benefits last week.  Prior to this year, the all-time record for a single week was just 695,000, and so we are talking about a level of unemployment that is absolutely catastrophic.  But what is really alarming many analysts is that the number for last week was quite a bit higher than the number for the week before.  Many states are rolling out new restrictions as the number of confirmed COVID-19 cases continues to surge, and this is having a huge impact on economic activity.  For months I have been warning that fear of COVID-19 would prevent economic activity from returning to normal levels for the foreseeable future, and that is precisely what has happened.

Overall, more than 52 million Americans have filed new claims for unemployment benefits over the past 18 weeks, and that makes this the biggest spike in unemployment in U.S. history by a very wide margin.

In fact, this dwarfs all previous spikes by so much that the others are not even worth mentioning.

Of course it isn’t just the employment numbers that are depressingly bad.  According to Jefferies, in late June 19 percent of all U.S. small businesses were closed, but now that number has risen to 24.5 percent

As of Sunday, 24.5% of small businesses in the United States were closed, according to Jefferies. That is worse than late June, when only 19% were closed. Jefferies pointed to “particular weakness in COVID hot spots” and noted that small business employment had dropped to levels unseen since the end of May.

Just think about that number for a minute.

Nearly a quarter of all small businesses in the entire country are closed.

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Jobless Thursday – How the Donald Is Making America Poor Again, by David Stockman

Make no mistake, America is getting massively poorer by the day. From David Stockman at lewrockwell.com:

Maybe it is time to don our tinfoil hat. Here’s the flat-out lie the WSJ reported this morning in response to the weekly unemployment claims release. It sure did make you think that the jobs picture is improving by the week:

The number of people receiving benefits through regular state programs, which cover the majority of workers, decreased by 1.1 million to 16.2 million for the week ended July 11. The decline extends the recent trend, with the number receiving benefits the lowest reading since the week ended April 11.

Just to make sure you grasped the good news, the WSJ added this chart for good measure:

Actually, there was no improvement at all this week!

And what remains is the greatest labor market disaster in history. As Wolf Richter observed in his excellent post on the heels of the DOL (Department of Labor) report:

If you read this morning or heard on the radio that 16.2 million people were claiming unemployment insurance – the “continued claims” – and you thought that there were only 16.2 million people who claimed unemployment benefits, you fell victim to lazy misreporting in the media, by reporters or bots that didn’t read the Labor Department’s press release beyond the second paragraph.

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War on Poverty, or Just War on the Poor? By Claudio Grass

Covid-19 lockdowns are decimating the poor. From Claudio Grass at lewrockwell.com:

As the dust is now begging to settle, both from the heights of the COVID panic and from the riots that shook the western world, we are starting to get an idea about where we stand after this unprecedented and tumultuous time. We are able to begin taking stock of the damage that was inflicted by the lockdowns and to evaluate the governmental efforts to help those affected and to provide support to the economy. More interestingly, we are finally in a position to see clearly who amongst us paid the highest price, who suffered the most and whose livelihood was taken away.

This picture is especially clear in the US, where the numbers speak for themselves. One look at the unemployment figures as seen in the chart below is enough to demonstrate the extent of the damage of the economic shutdown. However, a more detailed examination of the data reveals a lot more. It shows the sharp inequality in those lost jobs. Low- and minimum wage employees, seasonal, part-time and low-skill workers, were fired from their jobs at an astoundingly higher rate than their white-collar and better-paid peers. It makes sense, of course. Not only could these jobs be performed from home more easily, but these employees were also largely less replaceable. Being by and large more educated, more experienced and more skilled, there were seen as more “essential”, to use the government’s own terminology. Of course, all jobs are essential for those who need them to survive, but then again that argument never managed to gain any traction when bureaucrats were deciding who gets to keep their job and whose source of income is simply surplus to requirements.

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32 Million People on State & Federal Unemployment, 2nd Highest Ever: Week 17 of U.S. Labor Market Collapse, by Wolf Richter

There’s no recovery evident in the unemployment numbers, which are in fact getting worse. From Wolf Richter at wolfstreet.com:

Torrent of 2.4 million new claims under state & federal programs this week. PUA claims by gig workers now 45% of 32 million in total unemployment. Many people are hired back, but many people are newly laid off. Labor market recovery remains hard to discern.

The torrent of newly laid-off workers keeps flowing into state unemployment offices to claim unemployment at an astounding rate week after week. But many people who were claiming unemployment benefits in prior weeks were called back to work, or found new work. And the total number of people who continued to claim unemployment compensation in the week ended July 11 under all state and federal unemployment insurance programs, including gig workers and contract workers, dipped by 433,000 to 32.0 million (not seasonally adjusted), according to the Department of Labor this morning. It was the second highest level ever, after last week’s gut-wrenching record.

Unemployment insurance under state programs.

It’s not getting better: 1.50 million people who were newly laid off filed their initial unemployment claims with state unemployment offices in the week ended July 11, up from 1.40 million people who’d filed their initial claims in the week before.

Over the past five weeks, these initial state unemployment claims totaled 7.25 million, for an average of 1.45 million per week, which shows how relentlessly companies have shed workers week after week.

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Never Before Have I Seen So Much Fake Unemployment & Jobs Data by the Bureau of Labor Statistics. Labor Department Nails It, by Wolf Richter

The bean counters are at odds on unemployment numbers. From Wolf Richter at wolfstreet.com:

Labor Department today: People on state & federal unemployment insurance jumped to 31.5 million, worst ever.

Bureau of Labor Statistics today: 4.8 million jobs created, unemployment dropped by 3.2 million.

BLS under-reported unemployment by 13.7 million, based on data from the Labor Department. What’s happening is infuriating. Read and cringe.

Normally, the jobs report by the Bureau of Labor Statistics is released on the first Friday of the month. And the unemployment claims report is released Thursday every week. But this month, the monthly jobs report was also released today because of the 4th of July weekend. And now we have this delicious situation of both reports on the same day, with the Labor Department’s unemployment insurance data – people who are actually receiving unemployment benefits under state and federal programs – calling the Bureau of Labor Statistics’ survey-based report a liar. And we’ll go through them.

What the Labor Department reported today:

The total number of people who continued to receive unemployment compensation in the week ended June 27 under all state and federal unemployment insurance programs, including gig workers, surged by 937,810 people in the week, to 31.49 million (not seasonally adjusted), the highest and worst and most gut-wrenching ever:

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