The unemployment rate declined in June, and the unemployment rate declined in most states. Yet,…
The unemployment rate declined in June, and the unemployment rate declined in most states. Yet, unemployment claims continue to rise.
According to the Labor Department, unemployment rates were lower in June in 42 states, higher in 5 states, and stable in 3 states and the District of Columbia
Forty-nine states and the District had jobless rate increases from a year earlier, while one state had no change.
The national unemployment rate declined by 2.2 percentage points over the month to 11.1 percent but was 7.4 points higher than in June 2019.
Nonfarm payroll employment increased in all 50 states and the District of Columbia in June 2020.
This is all good news – a sign that government efforts to mitigate the worst economic effects of the coronavirus pandemic have been somewhat successful.
Yet, unemployment claims continue to mount. In the second week of July workers filed 1.3 million new unemployment claims. That made it the 17th straight week that unemployment claims topped 1 million.
This week is the last week workers will receive the expanded $600 in unemployment benefits that was a key part of the government’s relief effort. Economists fear that taking this consumer added consumer spending out of the economy will lead to yet more job losses.
Also, workers who were receiving the added benefits will find themselves unable to pay their bills – leading to a destructive cascade of mortgage delinquencies, renter evictions and unpaid loans.
The further destructive effects wrought on the economy could be felt far and wide – erasing whatever gains were made in June. We could be facing a grim late summer/fall period.