Claims are above their 665,000 peak during the 2007-09 Great Recession, though applications have dropped from a record 6.867 million at the end of March.
The number of Americans filing new claims for unemployment benefits unexpectedly increased last week, supporting views the economic recovery from the COVID-19 pandemic was running out of steam amid diminishing government funding.
Initial claims for state unemployment benefits totaled a seasonally adjusted 870,000 for the week ended Sept. 19, compared to 866,000 in the prior week, the Labor Department said on Thursday. Economists polled by Reuters had forecast 840,000 applications in the latest week.
Claims are above their 665,000 peak during the 2007-09 Great Recession, though applications have dropped from a record 6.867 million at the end of March. While the reopening of businesses in May boosted activity, demand in the services industries has remained lackluster, keeping layoffs elevated.
Job cuts have also spread to industries such as financial services and technology that were not initially impacted by the mandated business closures in mid-March because of insufficient demand.
Frequently Asked Questions
A vaccine works by mimicking a natural infection. A vaccine not only induces immune response to protect people from any future COVID-19 infection, but also helps quickly build herd immunity to put an end to the pandemic. Herd immunity occurs when a sufficient percentage of a population becomes immune to a disease, making the spread of disease from person to person unlikely. The good news is that SARS-CoV-2 virus has been fairly stable, which increases the viability of a vaccine.
There are broadly four types of vaccine — one, a vaccine based on the whole virus (this could be either inactivated, or an attenuated [weakened] virus vaccine); two, a non-replicating viral vector vaccine that uses a benign virus as vector that carries the antigen of SARS-CoV; three, nucleic-acid vaccines that have genetic material like DNA and RNA of antigens like spike protein given to a person, helping human cells decode genetic material and produce the vaccine; and four, protein subunit vaccine wherein the recombinant proteins of SARS-COV-2 along with an adjuvant (booster) is given as a vaccine.
Vaccine development is a long, complex process. Unlike drugs that are given to people with a diseased, vaccines are given to healthy people and also vulnerable sections such as children, pregnant women and the elderly. So rigorous tests are compulsory. History says that the fastest time it took to develop a vaccine is five years, but it usually takes double or sometimes triple that time.
Federal Reserve Chair Jerome Powell told lawmakers on Wednesday that Congress and the US central bank needed to "stay with it" in working to support the economy's recovery. In addition to cutting interest rates to near zero and vowing to keep borrowing costs low for a while, the Fed has also been pumping money into the economy.
Government money to help businesses has virtually dried up. Tens of thousands of airline workers are facing layoffs or furloughs next month unless the White House and Congress provide another rescue package.
A $600 weekly unemployment benefits supplement ended in July and was replaced with a $300 weekly subsidy, whose funding is already running out. New coronavirus cases have been rising recently and the death toll in the country topped 200,000 on Tuesday - by far the highest number of any nation.
The ebbing fiscal stimulus and persistent coronavirus infections are already restraining the economy after activity rebounded sharply over the summer. Retail sales and production at factories moderated in August. Business activity cooled in September, reports have shown.
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