Updated at 10:51 a.m. ET
A record 3.28 million Americans filed for unemployment benefits last week as the coronavirus pandemic shut down much of the country. The Labor Department's report for the week ended March 21 was one of the first official indicators of how many people have suddenly been forced out of work nationally.
In the prior report, for the week ended March 14, initial claims totaled 282,000.
"This marks the highest level of seasonally adjusted initial claims in the history of the seasonally adjusted series," the department said of the latest figure. "The previous high was 695,000 in October of 1982." The Labor Department's records go back to 1967.
Federal Reserve Chairman Jerome Powell, appearing on NBC's Today Show, said what businesses and analysts already know: "We may well be in a recession."
"This is a unique situation," Powell added. "People are being asked to close their business, to stay home from work, and to not engage in certain economic activity, and so they are pulling back. At a certain point, we will get the virus under control and confidence will return."
The staggering jobless claims figure was well above the levels seen during the darkest days of the Great Recession, and the worst isn't over yet, economic forecasters say.
The crisis has cut a giant swath through the energy, travel, transportation, hotel and restaurant sectors, with large and small companies suddenly forced to furlough employees.
States that depend heavily on tourism, such as Nevada and Florida, as well as oil-and-gas towns like Midland, Texas, will be especially hard hit, but the damage will be felt almost everywhere, according to a Brookings Institution report.
The hotel industry alone has lost as many as 1 million jobs this month, the American Hotel and Lodging Association says.
"It is a huge shock and we are trying to cope with it and keep it under control," says James Bullard, president of the Federal Reserve Bank of St. Louis. Earlier this week, he said unemployment would hit 30%. But he tempered those remarks Wednesday, saying he expected the number to fall again quickly.
New claims filed last week were nearly five times the number recorded during the peak of the Great Recession. In the week that ended March 28, 2009, about 665,000 new claims were filed. That was second only to the week that ended Oct. 2, 1982, when 695,000 first-time claims were filed.
"Most historical comparisons of this scale are inadequate," said Daniel Zhao, an economist with Glassdoor. "The coronavirus outbreak is economically akin to a major hurricane occurring in every state around the country for weeks on end."
The loss of that many jobs is expected to push unemployment to 5.5% — a level it last reached in 2o15 — but it's likely to climb even further. Goldman Sachs has predicted that the jobless rate could approach 13% during the next few months.
"If the number of new claims is as high as predicted and if it remains high in coming weeks, unemployment will skyrocket," the Joint Economic Committee of Congress said in a report ahead of Thursday's data.
The collapse of the job market has been unprecedented in size and speed.
Adam Hill of Worcester, Mass., worked until recently as a graphic designer at a company that organizes trade shows.
"A couple of weeks before this happened, we had a [company] meeting where we heard about how we did the previous year, and revenue was up. Everyone was pretty excited for the next year," he says.
"Then all of a sudden, this show canceled, and then another one and then another one. And within two weeks, I think, 155 shows had canceled. No shows, no money," he says. "I guess I wasn't too surprised when we got laid off."
Hill says he expects to be called back to work when the economy recovers, but no one is sure when that will be.
In the meantime, the Senate has approved a $2 trillion economic relief package that broadly expands unemployment benefits, extending them to gig workers and freelancers. It includes more generous benefits and extend eligibility for benefits by 13 weeks. A House vote is expected by Friday.
STEVE INSKEEP, HOST:
Just how many Americans are out of work? The best estimates say the number is in the millions now. And unlike with past economic shocks that unfolded over many months, this crisis arrived in weeks. Today, we learn with more certainty just how severe the job cuts have been in recent days. NPR correspondent Jim Zarroli covers business and economics. Jim, good morning.
JIM ZARROLI, BYLINE: Good morning, Steve.
INSKEEP: What are today's numbers that we're expecting?
ZARROLI: Well, we can expect a brutal picture, I think. We're almost certain to see record numbers of people who filed for unemployment last week. We have seen...
INSKEEP: Oh, that's the number. It's going to be one week. And it was the week that much of America shut down. That's what we're talking about here.
ZARROLI: Right, the week ending March 21. The week before that, we saw an increase of about 70,000, which was, you know, strong but - which was a lot, but not anything like what we are going to see this week. Economists so far are saying, you know, we will just see enormous losses last week. The Economic Policy Institute, for instance, it estimated that as many as 3.4 million people filed for claims last week.
Just for comparison - even during the worst weeks of the Great Recession, the number never topped 665,000. And we had almost that many in California alone last week. So, you know, the number of jobs lost is just way more than we've ever seen before. And that's just last week. We're going to be continuing to lose jobs for a while.
INSKEEP: Are some parts of the economy harder hit than others?
ZARROLI: Well, I mean, in the kind of complex, multilayered economy we have, the losses are eventually going to affect every part of the economy. A few industries have been especially hard hit now - transportation, especially airlines, energy and hotels and restaurants. So we're seeing places like Florida and Nevada, places that depend on tourism, hit really hard because nobody's traveling right now.
ZARROLI: A hotel industry trade group has said the industry probably lost a million jobs since this crisis began. Also seeing a drop in energy prices, so states like Texas and Oklahoma, where oil and gas is really important, have seen layoffs. But we're seeing people everywhere lose jobs.
INSKEEP: Jim, we've all lost track of time here, I think. It seems like every day is very long and very full, and that we've been in this crisis for a very long time. But wasn't the economy pretty good just a month ago?
ZARROLI: It was. I mean, remember, just before this virus struck, we were still in the middle of just a really strong job market. I mean, we had a 3.5% unemployment rate in February. And now the St. Louis Fed has actually estimated that we could see unemployment go above 30% in the next month or so...
ZARROLI: ...Although, it will probably fall down pretty quickly, too, the St. Louis Fed says. So a lot of people are just feeling whiplash. I talked to a guy named Adam Hill (ph) from Worcester, Mass. He worked, until very recently, as a graphic designer for a company that does trade shows. And he says, you know, as recently as a few weeks ago, his company was having a really good year.
ADAM HILL: Then all of a sudden, it's just this show canceled, and then another one and another one. And it was - within two weeks, I think 155 shows had canceled. I guess I wasn't too surprised when we got laid off.
ZARROLI: So he says he's been told he will be rehired once the economy rebounds and the company can afford to bring him back. But, of course, he doesn't know when that will be, none of us does.
INSKEEP: Now, we're talking on this morning after the U.S. Senate passed a $2 trillion economic rescue package. There's a lot in there for companies. There's a lot in there for workers. How important is that going to be for these millions getting laid off?
ZARROLI: Yeah. They will definitely get some help. I mean, most states, for instance, now offer 26 weeks of unemployment benefits. The bill adds another 13 weeks for that. For the first four months, people will get an extra $400. It also covers people who work freelance part-time. So that's really important in the gig economy when you have a lot of people like Uber drivers who don't work regular jobs.
ZARROLI: But the big question is, will that be enough? And that depends on how long this downturn goes on. Most economists think we'll see a sharp downturn, but then when the epidemic is contained, things will turn around pretty quickly.
INSKEEP: NPR's Jim Zarroli. Thanks.
ZARROLI: You're welcome. Transcript provided by NPR, Copyright NPR.