Layoffs are soaring amid the coronavirus outbreak – and much sooner than expected.
Initial claims for unemployment benefits – a reliable measure of layoffs – could rise to a record 2.4 million this week, according to a Goldman Sachs analysis of anecdotal reports from 30 states on the number of applications filed the first few days of the week.
Last week, jobless claims jumped by a third, to 281,000 from 211,000 the prior week. But if Goldman’s forecasts for this week are accurate, it would mark a nine-fold increase over the pre-virus level, the research firm said.
Goldman economist David Choi acknowledges in a research note that it’s possible that a disproportionate share of claims were filed early in the week or that his sample was biased toward states with unusually large increases in claims. Yet even in that case, jobless claims would still total more than 1 million, by far the highest on record. The Labor Department will report this week’s claims total Thursday.
The Goldman report also provides estimates of massive revenue declines in six industries since the outbreak began. It figures sales have fallen 95% in casino gambling; 80% in sports and entertainment; 75% in hotels; 70% in public transportation; 65% in restaurants; and 30% in retail goods.