The New Normal: US jobless claims increase to 742,00 as pandemic worsens; Marty Cantor answers your questions
The number of Americans seeking unemployment aid rose last week to 742,000, the first increase in five weeks and a sign that the resurgent viral outbreak is likely slowing the economy and forcing more companies to cut jobs.
The Labor Department's report Thursday showed that applications for benefits rose from 711,000 in the previous week. Claims had soared to 6.9 million in March when the pandemic first intensified. Before the pandemic, applications typically hovered about 225,000 a week.
CPA and economic development consultant Marty Cantor says these numbers show we still have a long way to go:
The economy's modest recovery is increasingly at risk, with newly confirmed daily infections in the United States having exploded 80% over the past two weeks to the highest levels on record. More states and cities are issuing mask mandates, limiting the size of gatherings, restricting restaurant dining, closing gyms or reducing the hours and capacity of bars, stores and other businesses. At least 15 states have tightened curbs on businesses to try to slow infections.
Evidence is emerging that consumers are losing confidence in the economic outlook and pulling back on shopping, eating out and other activities. Spending on 30 million credit and debit cards tracked by JPMorgan Chase fell 7.4% earlier this month compared with a year ago. That marked a sharp drop from two weeks earlier. Consumer sentiment also declined in early November and is down nearly 21% from a year ago, according to a University of Michigan survey.
The number of people who are continuing to receive traditional unemployment benefits fell to 6.4 million, the government said, from 6.8 million. That shows that more Americans are finding jobs and no longer receiving unemployment aid. But it also indicates that many jobless people have used up their state unemployment aid - which typically expires after six months - and have transitioned to a federal extended benefits program that lasts 13 more weeks.
If Congress doesn't act, we're looking at 12 million Americans who will see all of their unemployment benefits expire the day after Christmas. PUA and PEUC expiration, in addition to 4.4 million who will have exhausted their benefits before then.
There are big clear signs of a big change about how our economy functions. Cantor explains how spending is changing:
Cantor also comments on the MTA and how it affects the tri-state economics:
Cantor talks about PPP and taxes:
The pandemic pause on student loans is also coming. Cantor explains what borrowers should do:
AP wire services contributed to this report.
Watch the full New Normal show below: