The U.S. unemployment rate hit a record 14.7 percent in April as state and local lockdowns over the Wuhan coronavirus continue to land millions out of work each week since the pandemic began to take its toll in mid-March.
The new jobs report released Friday shows the steepest decline in job losses ever seen since the government began recording the national unemployment rate in 1939 as an unprecedented 20.5 million jobs fell victim to the public health pandemic. The highest rate up to this time had been 10.8 percent in 1948 with the most jobs lost in any single month having been nearly 2 million in 1945. That record had been shattered each week with millions of new jobless claims for the last month and a half with more than 33 million people now having filed for unemployment.
— Elizabeth Landers (@ElizLanders) May 7, 2020
Economists estimate that the U.S. neared 25 percent during the Great Depression.
The new jobs report illustrates just how widespread the economic devastation is, impacting every industry exacerbated by prolonged state and local lockdowns. Expanded unemployment benefits incentivize workers to seek government assistance over sticking with their employer.
A new study unveiled last week from the conservative Heritage Foundation reveals how Congress likely inflated unemployment by as much as nearly 14 million by driving up benefits with an additional $600 a week and radically relaxing eligibility requirements for individuals seeking government assistance. With no cap on earnings, Heritage researchers found that the median full-time American worker earning $48,000 a year would take home 15 percent more from unemployment insurance rather than remaining in their full-time job. Meanwhile, Congress loosened rules to qualify in the CARES Act blowing up benefits by requiring individuals to “quit his or her job as a direct result of COVID-19.”
The situation makes a win-win situation for workers and their employers at the expense of the taxpayer, where workers rake in more cash on government assistance over staying with their employer granted relief under the Paycheck Protection Program which mandates staff to remain on payroll.